Trade-Ideas: JA Solar Holdings Co ADR (JASO) 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 JA Solar Holdings Co ADR ( JASO) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified JA Solar Holdings Co ADR as such a stock due to the following factors:

  • JASO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $21.7 million.
  • JASO has traded 481,832 shares today.
  • JASO is down 6.3% today.
  • JASO was up 5.5% yesterday.

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More details on JASO:

JA Solar Holdings Co., Ltd., through its subsidiaries, is engaged in the design, development, production, marketing, and sale of photovoltaic solar cells and solar power products based on crystalline silicon technologies. Currently there are 2 analysts that rate JA Solar Holdings Co ADR a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for JA Solar Holdings Co ADR has been 2.4 million shares per day over the past 30 days. JA Solar Holdings Co ADR has a market cap of $411.8 million and is part of the technology sector and electronics industry. Shares are up 3.3% year-to-date as of the close of trading on Monday.

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

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates JA Solar Holdings Co ADR as a sell. Among the areas we feel are negative, one of the most important has been poor profit margins.

Highlights from the ratings report include:
  • The gross profit margin for JA SOLAR HOLDINGS CO LTD is rather low; currently it is at 16.72%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, JASO's net profit margin of 3.63% is significantly lower than the industry average.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, JA SOLAR HOLDINGS CO LTD's return on equity significantly trails that of both the industry average and the S&P 500.
  • JASO's debt-to-equity ratio of 0.70 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.74 is weak.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, and has traded in line with the S&P 500. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.
  • JA SOLAR HOLDINGS CO LTD reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, JA SOLAR HOLDINGS CO LTD continued to lose money by earning -$2.05 versus -$6.81 in the prior year. This year, the market expects an improvement in earnings ($1.24 versus -$2.05).

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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