NEW YORK ( TheStreet) -- China Sunergy ( CSUN) is rising by 10% on Thursday after announcing fourth quarter earnings that beat Wall Street expectations.

Earnings per share of 37 cents from China Sunergy were four cents ahead of the Wall Street consensus of 33 cents, but it wasn't a perfect earnings report from the Chinese solar company, either, with revenue and gross margin numbers providing minor disappointments.

Revenue fell short of the Wall Street consensus, at $169.6 million, versus Wall Street consensus of $174 million. Shipments came in a little below expectations, resulting in the revenue miss.

Gross margin expectations for the first quarter have been dialed back to 9%-10.5%, significantly below the fourth quarter gross margin level of 16%, which was 1% better than China Sunergy's previous guidance.

For the first quarter, China Sunergy expects shipments will be between 98 megawatts and 110 MW. For the full year of 2011, China Sunergy expects to ship 670 MW to 690 MW of solar modules.

Solar earnings season has demonstrated, in many cases, the "anything less than perfection" selling action. Yet even with the revenue shortfall and gross margin guidance weakness -- both of which have been triggers historically for negative solar trading -- China Sunergy was experiencing heavy bullish action on Thursday morning,

The 10% gain in China Sunergy shares was backed by four times the Chinese solar stock's daily volume of trading within the first two hours of the market open.

The positive response to the China Sunergy earnings could be described as a relief rally for an inexpensive stock, combined with weaknesses in the results that don't necessarily indicate structural flaws in the company model, and that executed in the fourth quarter after a series of acquisitions made to improve cost structure.

From a trading perspective, China Sunergy shares had been as high as $4.80 just a month ago. On Thursday morning, after the 10% rise, China Sunergy shares were trading at $4.35. "It's a round trip for the stock, nothing too ugly here," said Christine Hersey, analyst at Wedbush Securities, who noted that it doesn't take much with a $4 stock to generate an outsized return.

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