STP and solar stocks generally hit by Q-cell warning.
Sector Snap: Solar power stocks fall
Tuesday December 9, 3:38 pm ET
Shares of solar power companies fall after solar cell maker Q-Cells reduces guidance
SIOUX FALLS, S.D. (AP) -- Shares of several solar companies sunk Tuesday after German photovoltaic cell producer Q-Cells SE lowered its outlook through 2009 because of an expected inventory glut.
ThinkEquity Partners analyst Jonathan Hoopes said in a client note that Q-Cells as recently as Nov. 21 was running at full production capacity to keep pace with customers racing to complete installations before Jan. 1. On that date, Germany's feed-in tariffs, which pay for electricity generated by renewable resources, are scheduled to be reduced.
But the company has since been hit with a flood of requests to push back orders for delivery until 2009.
Hoopes said the rapid deterioration of industry fundamentals is a potential negative for LDK Solar Co., which has a processing agreement with Q-Cells, and Solarfun Power Holdings Co., which has a supply agreement with the company.
"Moreover, with channel inventories on the rise, we wonder if even low-cost First Solar will be completely immune," Hoopes said in a client note.
LDK shares lost $1.69, or 12.5 percent, to $11.81 in afternoon trading, while Solarfun was down 29 cents, or 5.9 percent, to $4.63. First Solar Inc. shares dropped $16.77, or 12.4 percent, to $118.07.
Other solar companies losing ground include: GT Solar International Inc., down 41 cents, or 12.1 percent, to $3.01; Suntech Power Holdings Co., down $1.39, or 13.8 percent, to $8.65; Trina Solar Inc., down $1.08, or 12.4 percent, to $7.63; and SunPower Corp., down $4.22, or 12.1 percent, to $30.67.
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