SOLF, YGE, WEST, TSL, STRI, SPWRA, Solar Stocks 16.78% undervalued
January 26, 2011 / M2 PRESSWIRE / BUYINS.NET / http://www.squeezetrigger.com is monitoring the Solar sector and these stocks are the most undervalued as of today. SOLARFUN POWER HOLD-SPON ADR (NASDAQ:SOLF), YINGLI GREEN ENERGY HOLD-ADR (NYSE:YGE), AKEENA SOLAR INC (NASDAQ:WEST), TRINA SOLAR LTD-SPON ADR (NYSE:TSL), STR HOLDINGS INC (NYSE:STRI), SUNPOWER CORP-CLASS A (NASDAQ:SPWRA) are all expected to go Up as they are undervalued according to industry standard valuation metrics. The valuation model employs a three-factor approach to stock valuation using fundamental variables--the company's trailing 12-month Earnings-Per-Share (EPS), the analyst consensus estimate of the company's forecasted 12-month EPS, and the 30-year Treasury yield--to create a highly accurate reflection of a company's fair value.
The chart below displays the projected Fair Value and Valuation discount/premium of the most undervalued stocks in the highlighted industry group:
Symbol Company Name Last Close Fair Value Valuation Industry SOLF SOLARFUN POWER HOLD-SPON ADR 9.02 10.84 16.78% undervalued Solar YGE YINGLI GREEN ENERGY HOLD-ADR 11.41 12.65 9.78% undervalued Solar WEST AKEENA SOLAR INC 0.575 1.97 70.76% undervalued Solar TSL TRINA SOLAR LTD-SPON ADR 28.02 29.74 5.79% undervalued Solar STRI STR HOLDINGS INC 18.33 20.94 12.47% undervalued Solar SPWRA SUNPOWER CORP-CLASS A 14.23 37.46 62.01% undervalued Solar
Here are some of the variables that are utilized when calculating the Fair Market Valuation of a stock: Long-run EPS growth rate, Duration of Business-growth-cycle, Volatility of EPS growth rate, Systematic or beta risk of the firm, Correlation between the firm's EPS and the interest rate environment, EPS growth volatility, Dividend payout ratio, Buffer earnings, Interest rate related criteria: Interest rate (30 year yield) long-run level, Duration of interest rate cycle, Interest rate volatility. The Fair Market Valuation uses 12-month historic and forecasted EPS values and the current 30-year treasury yield as primary determinants. When calculating risk/return values such as the Sharpe ratio, the historic periods used are five years.
Some expected results of the Valuation Model are: the valuation of a stock increases in a declining interest rate environment. Increasing current and/or projected EPS will produce a higher Valuation. While long-term EPS growth would produce a corresponding long-term Valuation increase, concomitant long-term interest rate increases would offset EPS growth and depress the Valuation. The shorter a company's own business cycle, the higher its stock Valuation will be.
SOLARFUN POWER HOLD-SPON ADR (NASDAQ:SOLF) - Solarfun Power Holdings Co., Ltd., an investment holding company, engages in the development, manufacture, and sale of photovoltaic (PV) products. The company offers PV cells, including monocrystalline and multicrystalline silicon cells; PV modules; and monocrystalline and multicrystalline ingots, as well as silicon ingots and wafers. It also provides PV cell and PV module processing services. The company sells its PV cells and PV modules directly to system integrators, as well as through third party distributors. Its customers include solar power system integrators and distributors primarily in Germany, the Czech Republic, Portugal, Australia, and the People's Republic of China. The company was founded in 2004 and is headquartered in Qidong, the Peoples Republic of China.
YINGLI GREEN ENERGY HOLD-ADR (NYSE:YGE) - Yingli Green Energy Holding Company Limited, together with its subsidiaries, engages in the design, development, marketing, manufacture, installation, and sale of photovoltaic (PV) products in the Peoples Republic of China and internationally. The company offers PV cells, PV modules, and integrated PV systems, as well as polysilicon ingots, blocks, and wafers. It sells its PV modules to PV system integrators, installers, and distributors in Germany, Spain, Italy, Greece, France, South Korea, the United States, and the People's Republic of China under the brand names of Yingli and Yingli Solar. The company also offers its integrated PV systems directly to end-users or to contractors for use in the electricity projects, as well as to mobile communications companies in the People's Republic of China. Yingli Green Energy Holding Company Limited was founded in 1998 and is headquartered in Baoding, the Peoples Republic of China.
AKEENA SOLAR INC (NASDAQ:WEST) - Akeena Solar, Inc. engages in the design, integration, installation, marketing, and sale of solar power systems. The company involves in the design and integration of grid-tied solar power systems, which are electrically connected to the utility grid so that excess energy produced during the day flows backwards through the utilitys electric meter. It also offers AC solar panels. The company sells its solar power systems to residential customers that comprise high-income professionals, as well as to commercial customers, including owner occupied businesses consisting of wineries and small commercial offices in the United States; and AC solar panels to solar installers, trade workers, and do-it-yourself customers in the United States and Canada, through distribution partnerships, dealer network, and retail outlets. It has a strategic partnership with Enphase Energy to develop and market Andalay solar panel systems with ordinary AC house current output instead of high voltage DC output. The company was founded in 2001 and is headquartered in Los Gatos, California with additional offices in Palm Springs and San Diego, California.
TRINA SOLAR LTD-SPON ADR (NYSE:TSL) - Trina Solar Limited, through its subsidiaries, designs, develops, manufactures, and sells photovoltaic (PV) modules worldwide. The company offers monocrystalline PV modules ranging from 165 watts to 240 watts in power output; and multicrystalline PV modules ranging from 215 watts to 240 watts in power output for use in residential, commercial, industrial, and other solar power generation systems. It also involves in the design and production of various PV modules, such as colored modules for architectural applications and larger sized modules for utility grid applications based on customers and end-users specifications. Trina Solar Limited sells and markets its products primarily to distributors, wholesalers, power plant developers and operators, and PV system integrators. The company was founded in 1997 and is based in Changzhou, the Peoples Republic of China.
STR HOLDINGS INC (NYSE:STRI) - STR Holdings, Inc., through its subsidiaries, engages in the manufacture and sale of encapsulants that are specialty extruded sheets and films used in the production of solar modules worldwide. The company operates in two business segments, Solar and Quality Assurance (QA). The Solar segment offers encapsulants that protect the embedded semiconductor circuits of solar panels to solar module manufacturers. The QA segment provides product development, inspection, testing, and audit services that enable retailers and manufacturers to determine whether products meet applicable safety, regulatory, quality, performance, and social standards. The company was founded in 1944 and is based in Enfield, Connecticut.
SUNPOWER CORP-CLASS A (NASDAQ:SPWRA) - SunPower Corporation, together with its subsidiaries, designs, manufactures, and markets solar electric power technologies. The company operates in two segments, Components and Systems. The Components segment manufactures and sells solar power products, including solar panels and inverters, which convert sunlight to electricity compatible with the utility network. This segment sells solar components for use in residential and commercial applications to installers and resellers, including its third-party global dealer network. Its products are also used in multi-MWac solar power plant applications. The Systems segment sells solar power systems directly to system owners and developers. Its services include development, engineering, procurement, permitting, construction, financing options, monitoring, and maintenance. This segment principally offers PowerGuard roof system, a roof-mounted solar panel mounting system; SunPower T-10 commercial solar roof tiles, which are pre-engineered solar panels; SunPower T-5 solar roof tile system that combines solar panel, frame, and mounting system into a single pre-engineered unit; SunTile roof integrated system for residential market; ground mounted SunPower Tracker systems; and fixed tilt and SunPower Tracker systems for parking structures. Its customers include commercial and governmental entities, investors, electric utilities, independent power producers, production home builders, and homeowners worldwide. SunPower Corporation has a joint venture with AU Optronics Corp. to construct and operate a solar cell manufacturing facility in Malaysia. The company was incorporated in 1985 and is headquartered in San Jose, California. SunPower Corporation operates independently of Cypress Semiconductor Corporation, as of September 22, 2008.
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