November 19, 2008 - Solar stocks to a hit on Tuesday on comments from J.P. Morgan’s Christopher Blansett about the potential for reduced subsidies for solar in Europe. Blansett said that 2008 may he thinks 2008 was a peak for solar energy subsidization and recommended First Solar (Nasdaq:FSLR) as a “safe haven.” We disagree with Blansett’s assessment and timing. We think his assessment is doesn’t account for the legislative realities in place in the U.S., Japan and Europe. And we think his timing to call for instability in solar stocks is extremely late. Here is our take: Blansett clearly isn’t impressed by Governor Schwarzenegger’s mandate for 33% renewable energy contribution in California, the potential impact and long-term stability in the U.S. market provided by the eight-year solar tax credit extension, and the expectation that Obama’s administration will likely accelerate the passage in Congress of a federal RPS. We think these ...

November 4, 2008 – The global wind industry installed almost 20,000MW of new capacity in 2007, bringing the worldwide total to 93,864MW. The global wind market added 19,813MW from 2006 to 2007, a 26% increase. From an economic perspective the global wind market in 2007 was worth about $37 billion in equipment and it garnered about $50.2 billion of total investment. Top Five Countries in Terms of Installed Capacity in 2007 1.     Germany (22.3GW) – the Germany Wind Energy Association says that by 2020 the overall German onshore capacity could be at 45,000MW with an additional 10,000MW offshore; 2.     U.S. (16.8GW) – as of the Q3, 2008, the U.S. had 21GW installed capacity with another 8.3GW under construction, and the U.S. is expected to overtake Germany as the leading wind energy country by the end of 2009; 3.     Spain (15.1GW) – The Spanish Wind Energy Association estimates that 40,000MW of onshore ...

October 29, 2008 – With valuations on the S&P based on estimated profits now at 10.7 times, and valuations in the solar sector at even lower levels, we have to ask how pessimistic, and how cynical the markets are going to get when valuing these companies. What is a reasonable valuation for an industry that is growing 62% per year and for leading companies that are posting triple-digit earnings and revenue growth? For example, LDK Solar (NYSE:LDK) is trading 6.13 times trailing 12 months earnings, and slightly more than 1 times trailing 12 months sales. It is posting more than $100 million in profit per month, it has $1 billion in cash (on prepayments of contracts) and is booked through 1018. It has no need to raise capital and has recently said it won’t do so for the next couple years while it is doubling production capacity. The company expects ...