Solar Industry Movers: 3 Winners and 1 Loser

WINNER: SunPower Corporation (NASDAQ:SPWR)

Last week, a holding company controlled by Berkshire Hathaway (NYSE:BRKA)(NYSE:BRKB) purchased the world’s largest permitted photovoltaic power development — the 579-megawatt Antelope Valley Solar Projects — from SunPower for between $2 and $2.5 billion. The rest is, well, take a look at the stock chart.

Shares are up over 34 percent for the past five trading days, despite some pullback at the beginning of this week as the markets generally simmer down after a hot start to the New Year. But shares are still trading hands at over twice their three-month average volume of 1.5 million per day, and the company’s market cap is flirting with $1 billion for the first time since October 2011.

The stock has smashed the mean analyst price target of $5.60 per share and has revitalized a long-running debate over the near- and mid-term future of the solar industry. Specifically, is it ready to recover after a period of crashing silicon prices, tremendous over capacity, and slow economic growth?

SunPower Corporation Stock Chart - SPWR Interactive Chart - Yahoo! Finance

Save time and make money with our LOWEST ADVERTISED PRICE EVER to help you achieve your financial goals in 2013. This is a LIMITED TIME OFFER, so get your Stock Picker Newsletter now!

WINNER: SolarCity Corporation (NASDAQ:SCTY)

SolarCity says “yes” to the question of a solar industry recovery. Shares have come up 35 percent since their IPO in December and were subject to the same tremendous growth that many other solar stocks saw at the beginning of the new year, in part catalyzed by Buffett’s proxy endorsement of the industry.

SolarCity does not actually manufacture solar panels, but instead offers installation, maintenance, and financing services for residential and corporate consumers who are interested in taking the leap but might not have deep enough pockets. The model is apparently working, given that the company is expecting 2013 installations to grow 60 percent compared to 2012.

SolarCity Corporation Stock Chart - SCTY Interactive Chart - Yahoo! Finance

Are these stocks a buy or sell? Let us help you decide. Check out our Stock Picker Newsletter now.

WINNER: LDK Solar Co., Ltd. (NYSE:LDK)

One more winner before we get to this period’s solar loser. LDK solar is a small-cap producer of photovoltaic products based in China, and after a few months of concern that it would get kicked off the New York Stock Exchange for failing to keep its stock price over $1 per share, LDK is back in the race. A 90 percent rally over the past one-month period has brought the stock price up to par, and gains of 25 percent over the past 5 days put this company at the top of the list heading into 2013.

But there’s obviously more to this company than its stock chart. The company has a trailing-twelve-months diluted EPS of -$9.17 and revenue dropped 38 percent year over year in the last quarter. Until the recent rally, LDK was a poster child for the maladies of overcapacity.

LDK’s saving grace lays in a renewed $2 billion solar subsidy program initiated by the Chinese government that was announced in December.

LDK Solar Co. Inc. American Dep Stock Chart - LDK Interactive Chart - Yahoo! Finance

Save time and make money with our LOWEST ADVERTISED PRICE EVER to help you achieve your financial goals in 2013. This is a LIMITED TIME OFFER, so get your Stock Picker Newsletter now!

LOSER: First Solar, Inc. (NASDAQ:FSLR)

It’s not necessarily accurate to call First Solar a loser — it’s more complicated than that — but it definitely did not get an invite to the same party that the rest of the solar industry went to. Shares that rallied over 115 percent over the past six months are down 3.5 percent for the past five trading days.

Observers may have noticed that while First Solar has grown its revenues consistently since 2008, the company reported an earnings loss of $0.46 per share in 2011. The company also reported a year-over-year drop in earnings last quarter, with EPS of $1.00 compared to $2.25 a year earlier.

First Solar, Inc. Stock Chart - FSLR Interactive Chart - Yahoo! Finance

Investing Insights: Can Alpha Natural Resources Beat the Odds and Outperform in 2013?