Trade-Ideas: Trina Solar (TSL) Is Today's

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Trina Solar ( TSL) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Trina Solar as such a stock due to the following factors:

  • TSL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $88.3 million.
  • TSL has traded 69,824 shares today.
  • TSL is up 4.3% today.
  • TSL was down 6.6% yesterday.

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More details on TSL:

Trina Solar Limited, an integrated solar-power products manufacturer, engages in the design, development, manufacture, and sale of photovoltaic (PV) modules worldwide. The company provides mono- and multi-crystalline silicon ingots, wafers, cells, and related products. Currently there are 5 analysts that rate Trina Solar a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for Trina Solar has been 5.5 million shares per day over the past 30 days. Trina Solar has a market cap of $1.2 billion and is part of the technology sector and electronics industry. Shares are up 18.9% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Trina Solar as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and poor profit margins.

Highlights from the ratings report include:
  • TSL's very impressive revenue growth greatly exceeded the industry average of 9.7%. Since the same quarter one year prior, revenues leaped by 84.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 117.28% and other important driving factors, this stock has surged by 171.94% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • TRINA SOLAR LTD reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, TRINA SOLAR LTD reported poor results of -$3.76 versus -$0.58 in the prior year. This year, the market expects an improvement in earnings (-$1.19 versus -$3.76).
  • The gross profit margin for TRINA SOLAR LTD is rather low; currently it is at 15.21%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, TSL's net profit margin of 1.80% is significantly lower than the industry average.
  • The debt-to-equity ratio of 1.37 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, TSL has a quick ratio of 0.70, this demonstrates the lack of ability of the company to cover short-term liquidity needs.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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