Inverter industry:
Joel Silverman of Arete Research Services reckons industry-wide (inverter) capacity has more than doubled this year (2010) to more than 34 GW, and should hit roughly 48.5 GW by the end of 2011.
Global solar installation prediction: 17GW in 2010, 17GW in 2011, and 19GW in 2012. If that happens, it means trying to increase sales will be a zero-sum game in 2011 (for everything from polysilicon to inverters): any winners must take sales away from someone, as the size of the market won't increase much in unit terms, and will go down in dollar terms.
Solar prices are dropping again. Solar modules in the spot, or temporary, market, can be scooped up for $1.60 a watt at the moment and for $1.40 a watt or less under volume contracts.
below $3/w by end-2011 = wholesale price for large-scale solar, fully installed.
At $2.50 a watt, solar panels become the hands-down choice among renewable energy technologies.
At $2.00 a watt, solar begins to rival conventional fuels.
SMA Solar (#1 market share) said it expects record sales for 2010, at the upper end of the sales forecast of €1.7bn to €1.9bn. ‘It is very difficult to forecast the development of the global photovoltaics markets in 2011. In particular expected changes in incentive programs in individual countries may have considerable effects on the global market volume in 2011,’ the company said in a statement... ...hopes to achieve sales of €1.5 to €1.9 billion in 2011... ...EBIT margin is predicted to fall to around 21 to 25 percent in 2011, from 27.5% in 2010, "due to changes in the competitive situation."
PWER = Power-One: Reliability and modularity in product design has allowed the firm to reach #2 market share in solar inverters, up from 9th in 2008. $195 million in cash versus just $40 million in debt. PE 16.
Questions I have about the inverter industry:
1. barriers to entry?
2. commodity?
3. are the best companies available to investors?
4. are they facing oversupply, falling margins, and falling prices in 2011?
info from:
greentechmedia.com
online.wsj.com
seekingalpha.com
newenergyworldnetwork.com
pv-magazine.com |
