Many solar stocks are likely experiencing rapid short covering.  Sticking around for the lowest prices after serious success is a sucker’s game.  There may also be a political angle here now that President Obama’s poll numbers are looking a bit better.  The problem is that it is going to take more now than a President with a continued favorable stance to alternative energy.  The fundamentals remain weak and now investors are getting to evaluate whether there is any value of if they are value traps.  Take a look at some of the moves…

First Solar, Inc. (NASDAQ: FSLR) is up 7.5% at $49.29 against a 52-week range of $42.50 to $175.45.  The most recent short interest data showed that the short interest was 18 million shares and that was actually down from most reports in the fourth quarter of 2011

SunPower Corporation (NASDAQ: SPWR) is up over 13% at $8.53 today against a 52-week range of $4.94 to $23.36. The most recent short interest data showed that the short interest was 5.7 million shares, down from a November peak of 9.3 million shares and much lower than the 11.7 million shares short back at the end of June.

Energy Conversion Devices, Inc. (NASDAQ: ENER) is even up 12% to $1.29 and no longer at much of a delisting risk.  Its 52-week range is $0.20 to $4.29. The most recent short interest data showed that the short interest was 11.4 million shares at the lowest levels in a year since it had become a penny stock.

Trina Solar Limited (NYSE: TSL), out of China, is up a whopping 24% at $11.44 against a 52-week range of $5.28 to $31.08.  That makes for a gain of 70% so far in 2011 and it would have to almost rise 200% to challenge its year-high. The most recent short interest data showed that the short interest was 15.5 million shares.

MEMC Electronic Materials, Inc. (NYSE: WFR) is also up 8% at $5.78 against a 52-week range of $3.65 to $15.04.  That gives a gain of almost 47% so far in 2012.  The most recent short interest data showed that the short interest was 14.5 million shares and that was actually higher than at the end of 2011 even if it is lower than prior months.

JON C. OGG

Solar makers are trying to stage a recovery.  First Solar, Inc. (NASDAQ: FSLR) is the leader of the pack in quality and operations and its shares are up about 9% at $42.30 versus a 52-week trading range of $29.87 to $175.45.  Even more impressive is the move in shares of MEMC Electronic Materials Inc. (NYSE: WFR) with a 17% gain to $4.58 versus a 52-week range of $3.65 to $15.04.  Even the Guggenheim Solar (NYSE: TAN) ETF and the Market Vectors Solar Energy ETF (NYSE: KWT) are surging.  We are paying close attention to SunPower Corporation (NASDAQ: SPWR), Suntech Power Holdings Co. Ltd. (NYSE: STP), Yingli Green Energy Holdings Co. Ltd. (NYSE: YGE), LDK Solar Co. Ltd. (NYSE: LDK), Energy Conversion Devices, Inc. (NASDAQ: ENER) and others as well.  Here are the other movers with relative prices to their 52-week highs:

• SunPower Corporation (NASDAQ: SPWR) is up 9.5% at $7.33, down from a year high of $23.36;
• Suntech Power Holdings Co. Ltd. (NYSE: STP) is up a whopping 25% at $3.22 versus a year high of $10.83;
• Yingli Green Energy Holdings Co. Ltd. (NYSE: YGE) is up 17% at $4.85 versus a year high of $13.59;
• LDK Solar Co. Ltd. (NYSE: LDK) is up 11.3% at $5.21 against a high of $14.97 in the last year, although it is easy to stick by the guns that LDK is mathematically bankrupt without the coverage of the Chinese government.
• Energy Conversion Devices, Inc. (NASDAQ: ENER) is up 23% at $0.38 against a high of $4.80 but this is one still is unlikely to survive 2012.

In the world of ETFs, these are running as well: Guggenheim Solar (NYSE: TAN) is up 10.5% at $2.95 versus a high of $9.16 and Market Vectors Solar Energy ETF (NYSE: KWT) is up 11.5% at $4.45.  The more diversified alt-energy ETF of PowerShares WilderHill Clean Energy (NYSE: PBW) is up less than all of these with gains of 4.8% at $5.65.

Before getting too euphoric keep in mind that this is not unusual at the start of a year or new period where sector rotation favors the most beaten up sector.  Besides that, there is always the political angle on the solar sector that is front and center in the elections this year.

What we do know within reason is simple: solar PV unit prices cannot drop by another 50% or so in 2012.  If pricing has bottomed, perhaps these value traps may get to migrate to value stocks after all.  We still expect margin pressure, austerity, and a lack of the ability to pay dividends to all equal concerns of PV panel dumping by Chinese firms leading to a virtual race toward zero.

If you want to know just how big this news is, the S&P Utility Sector was the best performing sector in all of 2011 and its gains were not quite 15%.  To prove the point, the Utilities Select Sector SPDR (NYSE: XLU) ETF rose by 19% in 2011 if you adjust for the dividend payments as so many utilities offer investors dividend yields of 4% and higher.

JON C. OGG

Samsung wins the legal fight over whether it can sell its tablet PC in Australia despite objections from Apple (NASDAQ: AAPL). (Reuters)

A Facebook  IPO will make a number of the social network’s workers rich and give huge returns to several VCs. (Reuters)

China’s industrial output drops to a two-year low, and inflation also fell. (Reuters)

Toyota (NYSE: TM) expects lower profits because of the yen and Thailand floods. (Reuters)

Panasonic will try to enter the smartphone market again. (Reuters)

Zynga claims it can double the number of paid players it has in a short time. (Reuters)

Soros may have bought many of the bonds on which MF Global lost money. (WSJ)

Walmart (NYSE: WMT) says it is looking into bribery charges overseas. (WSJ)

The rise in the value of the yuan appears to have ended. (WSJ)

Locations open 24 hours a day helped McDonald’s (NYSE: MCD) sales last month. (WSJ)

Jewelry retailer Chow Tai Fook Jewellery Group raises $2 billion in a Hong Kong IPO. (WSJ)

Sharp raises its forecasts for 2012 TV sales. (WSJ)

ZTE will start to sell smartphones in the U.S. (WSJ)

Inflation likely will be ahead of home values through 2016. (WSJ)

Some new apps have features that push aside ads from companies like Facebook and Yahoo! (NASDAQ: YHOO). (WSJ)

MEMC Electronic (NYSE: WFR) to cut its staff by 20% due to problems in the semiconductor and solar businesses. (WSJ)

Texas Instruments (NYSE: TXN) cuts its forecasts. (WSJ)

Nokia (NYSE: NOK) is about to launch new smartphones in the U.S. — the Lumia product — which will use Microsoft’s (NASDAQ: MSFT) Windows mobile OS. (WSJ)

Wells Fargo (NYSE: WFC) settles a bid-rigging case from Wachovia for $148 million. (WSJ)

EU banks are expected to show a 115 billion euro shortfall when stress tests are completed. (FT)

Hedge funds will have their worst year since 2008. (FT)

The EU drops plans to have private investors participate in write-offs of sovereign paper. (Bloomberg)

Moody’s cuts it ratings of Societe Generale, BNP Paribas and Credit Agricole. (Bloomberg)

Douglas A. McIntyre

Falling prices have been punishing the industry, and other low-cost Chinese providers like Trina Solar Ltd. (NYSE: TSL), JA Solar Holdings Co. Ltd. (NASDAQ: JASO), Suntech Powsr Holdings Co. Ltd. (NYSE: STP), and LDK Solar Co. Ltd. (NYSE: LDK) have taken a beating. Higher priced makers like SunPower Corp. (NASDAQ: SPWRA) are getting even more punishment. Solyndra is in bankruptcy now because it could not get its cost structure in line with the collapse in panel pricing.

The lower prices have had the expected effect though. Even as countries have lowered solar subsidies, falling panel prices have kept demand reasonably high because the cost of installing solar is reaching a point where it is price-competitive. Firms like First Solar, SunPower, MEMC Electronic Materials Inc. (NYSE: WFR) that have acquired project development companies are able to cope better with the decline in panel prices because they have both a captive and growing market.

There’s little argument that the falling price of modules have extended the market for solar PV, which is why the trade case filed by SolarWorld and the unnamed US solar panel makers is getting no support from firms like First Solar, SunPower, or MEMC. In fact, a rival group, called CASE, the Coalition for Affordable Solar Energy, has been quickly put together to fight against the SolarWorld-led trade case.

Their argument is that falling prices for solar modules have brought solar generation prices down to near grid parity with coal and natural gas generation. Slapping a tariff on solar panels will essentially kill the gains made by the industry. In fact, a Chinese solar project developer has said that a 30% tariff on imported solar panels will make uneconomic $500 million in new solar developments the company has planned in the US.

US energy company Sempra Energy (NYSE: SRE) is building a 700-megawatt solar farm project near Phoenix that will use 200 megawatts of panels from Suntech. If the trade case is decided in favor of SolarWorld, panels from US makers like First Solar could be substituted, but the entire cost of the project would rise, changing the power purchase agreement that is the basis for the project and, ultimately perhaps, making the project uneconomic. The loss of the installation jobs would cost the US economy more than it would gain from having a US maker supply the panels. US makers build most of their panels overseas anyway.

SolarWorld is the largest maker of solar panels in the US, and employs about 1,300 workers at its plant near Portland, Oregon. A grand total of all US workers involved in making solar panels for distribution and sale could not exceed 3,000, while more than 52,000 US jobs are supported by solar installers. In terms of US job creation, the numbers support low-cost modules and high installation counts.

That JinkoSolar or some of the other solar makers may go bust is a near certainty. There are too many makers with too much capacity all angling for too few projects. But as module prices continue their decline, it becomes unnecessary for governments to subsidize more solar installations and more solar projects are very likely to make it off the drawing board.

One solar industry official (from a project installer) has likened the fight over dumping to a circular firing squad, where everyone is going to take some hits. The survivors will be those who bleed the least.

Paul Ausick

The most noticeable data point is how far off these stocks are from their 52-week highs. The U.S.-based stocks are off nearly 60%, while the China-based companies are down a minimum of 75%. Trina and LDK have been hit with accounting questions, as have many other Chinese firms, and that has carried over to the other Chinese solar makers as well. That is likely the cause of the 15% differential in current distance from the 52-week high.

Applied Materials has a median target price of $12.50 from 17 brokers. Shortly before noon today, shares are trading at $11.96, for an implied gain of $0.54, or 4.5%. Applied’s forward P/E is 12.46 and the company pays a dividend yield of 2.7%. The stock’s 52-week trading range is $9.70 to $16.93, and at today’s price that is about 23% above its 52-week low, posted earlier this morning, and 29% below the 52-week high. Applied’s dividend yield has dropped from nearly 3% six weeks ago, its price target has fallen from $13.88, and it has posted a new 52-week low. At our last look, this was the one company that looked like it might be a value play, but that view is getting weaker by the day. Applied is the only company in this group that pays a dividend.

First Solar has a median target price of $108.50 from 34 brokers. Shortly before noon, shares are trading today at $60.22, for an implied gain of $48.28, or 80%. First Solar’s forward P/E is 5.97 and the company does not pay a dividend. The stock’s 52-week trading range is $50.87 to $175.45, and at today’s price that is about 18% above its 52-week low and 66% below the 52-week high. First Solar is the largest of the solar panel makers measured by market cap. The company’s low-cost leadership has been challenged by the constantly falling prices of crystalline solar manufacturers, particularly the Chinese. Once a growth stock, First Solar shares have performed miserably so far this year.

MEMC Electronic Materials has a median target price of $9.00 from 20 brokers. Shortly before noon today, shares are trading at $6.19, for an implied gain of $2.81, or 45%. MEMC’s forward P/E is 5.84 and the company does not pay a dividend. The stock’s 52-week trading range is $4.58 to $15.04, and at today’s price that is about 35% above its 52-week low and 59% below the 52-week high. MEMC has been able to hold the line somewhat on solar wafers in the face of increasing competition from Chinese makers. The company, like First Solar and SunPower, also owns a solar project development company, SunEdison, and if there is any growth in the solar sector, it is in financing and installing rooftop systems. The project groups of these three companies are geared toward industrial-scale projects, though, so they will have to change direction or they will not see much benefit from rooftop installation growth.

GT Advanced Technologies has a median target price of $15.00 from 25 brokers. Shortly before noon, shares are trading today at $7.34, for an implied gain of $7.66, or 104%. GT’s forward P/E is 3.94 and the company does not pay a dividend. The stock’s 52-week trading range is $6.40 to $17.50, and at today’s price that is about 15% above its 52-week low and 58% below the 52-week high. Formerly known as GT Solar, this company had a breakout first half of 2011 as the expansion of China’s manufacturing capacity created high demand for GT’s specialized manufacturing equipment. Now that capacity exceeds demand, new orders have slowed and prospects for growth are dimming.

SunPower has a median target price of $13.00 from 13 brokers. Shortly before noon today, shares are trading at $9.67, for an implied gain of $3.33, or 34%. SunPower’s forward P/E is 9.28 and the company does not pay a dividend. The stock’s 52-week trading range is $6.60 to $23.36, and at today’s price that is about 47% above its 52-week low and 59% below the 52-week high. SunPower’s shares jumped to 52-week highs on the offer by French energy giant Total SA (NYSE: TOT) to acquire 60% of SunPower’s stock. Shares have tumbled since then, and it is not unthinkable that Total overpaid for the company. SunPower is not a low-cost provider of solar panels, and that could limit the company’s growth going forward.

Suntech Power has a median target price of $4.00 from 30 brokers. Shortly before noon today, shares are trading at $2.37, for an implied gain of $1.63, or 69%. Suntech’s forward P/E is 34.29 and the company does not pay a dividend. The stock’s 52-week trading range is $1.70 to $10.83, and at today’s price that is about 39% above its 52-week low and 78% below the 52-week high. Suntech now makes more solar modules than any other company in the world. That would be great, if the company could sell the modules at a price that offers it a profit. A recent trade case against Chinese solar makers could push these stocks down even more.

Trina Solar has a median target price of $15.00 from 26 brokers. Shortly before noon, shares are trading today at $7.70, for an implied gain of $7.30, or 95%. Trina’s forward P/E is 6.26 and the company does not pay a dividend. The stock’s 52-week trading range is $5.28 to $31.08, and at today’s price that is about 46% above its 52-week low and 75% below the 52-week high. Like Suntech, Trina is a low-cost, high-volume maker of solar panels and it faces all the same problems.

LDK Solar has a median target price of $5.80 from 14 brokers. Shortly before noon today, shares are trading at $3.27, for an implied gain of $2.53, or 77%. LDK’s forward P/E is 10.64 and the company does not pay a dividend. The stock ’s 52-week trading range is $2.55 to $15.10, and at today’s price that is about 28% above its 52-week low and 78% below the 52-week high.  LDK’s implied growth of 77% is pure fiction, at least through the end of 2013.

JA Solar has a median target price of $3.00 from 14 brokers. Shortly before noon today, shares are trading at $2.30, for an implied gain of $0.70, or 30%. JA Solar’s forward P/E is 5.43 and the company does not pay a dividend. The stock’s 52-week trading range is $1.46 to $9.77, and at today’s price that is about 58% above its 52-week low and 76% below the 52-week high. JA Solar shares are the furthest above their 52-week low of any of the stocks in the group. That might be good news if the forward P/E were greater than 5.43. Like the other Chinese makers, this stock is very weak and could be the first of all these stocks to bust the buck on the way down.

Paul Ausick

It’s not too surprising that First Solar, SunPower, and MEMC are keeping a low profile on this issue. All three own project development and construction companies that focus on large-scale solar projects that are highly likely to use the company’s own solar panels. Pure solar installation companies, like Real Goods Solar Inc. (NASDAQ: RSOL) and privately held Sungevity and SolarCity, have welcomed the lower prices for solar panels because it lowers their system costs and generally helps their business.

As we noted earlier this week, solar panel manufacturing jobs are relatively small beer in the US. The increased availability of financing for residential and commercial rooftop systems is driving the solar installation business in the US, and it is being helped by lower prices for solar panels.

Another twist in this story is that Chinese solar PV makers are currently suffering at least as much, if not more, than their US counterparts. Plummeting prices coupled with manufacturing capacity increases have hurt Suntech and LDK significantly. Some of the Chinese solar makers are also being questioned about their accounting practices, and that has cast a pall over the entire industry.

Unanimity among US solar companies is virtually guaranteed to go missing as this case proceeds. Every company has a different axe to grind, with the large US PV makers/project developers clearly wanting to steer clear of the case, along with US installers who benefit from the lower prices for solar panels. SolarWorld, with about 1,300 US manufacturing employees, and a handful of other small start-up firms are likely to be the only supporters of the trade case.

Politicians from both parties are likely to jump on this case because it has an obvious good guy — the US — and an obvious bad guy — China. Just about any comment from either party can be safely ignored. The lost solar manufacturing jobs would have gone to offshore in any event. Most of First Solar’s manufacturing is done in Malaysia and SunPower’s largest plants are in the Philippines.

The real reason that China supports so much solar manufacturing is not simply labor costs, but the low cost and easy access to capital. That may be changing now, as the country tries to cool off its economy and its inflation rate. The ability of China’s manufacturers to continue driving down costs may be coming to an end regardless of this trade case.

Paul Ausick

Bank of America Corp. (NYSE: BAC), Citigroup Inc. (NYSE: C), Wells Fargo & Co. (NYSE: WFC), and the GE Capital division of General Electric Co. (NYSE: GE) have been the most active investors in alt energy. Google Inc. (NASDAQ: GOOG), though not a bank, has invested about $850 million in a variety of alt energy projects over the last couple of years as well.

Citi claims to have committed $30 billion of the $50 billion clean energy initiative it launched in 2007. At the end of July, the bank committed $80 million to a $105 million fund to be used for residential solar lease projects with SunPower Corp. (NASDAQ: SPWRA). The bank also put $40 million into a similar fund in February in conjunction with SolarCity and another $50 million into a residential solar lease fund with solar PV installer Sungevity.

BofA has put up $1.4 billion, of which 80% will have federal guarantees, for rooftop solar project aimed at industrial and commercial businesses. The bank committed $20 billion in 2007 to a 10-year initiative similar to Citi’s. The bank had committed $8.4 billion of that by the end of June 2011, of which about $5.4 billion was directed to lending and investing programs.

Wells Fargo last week announced that it has provided more than $200 million to finance a 53.5-megawatt solar project being developed by the Sun Edison subsidiary of MEMC Electronic Materials Corp. (NYSE: WFR) in New Mexico. The bank claims that it has invested about $2.2 billion in 35 wind and more than 220 solar energy projects since 2006.

GE Capital has invested $6 billion in renewable energy projects in 14 countries. The investments include 95 wind farms and 40 solar installations. Unlike the bank investments, GE often takes equity positions in its investments. At the Shepherds Flat wind farm project in Oregon, for example, GE won a contract to supply $1.4 billion in turbines and made an unspecified investment in the project.

The rooftop leasing business is getting the most attention right now because it offers homeowners and commercial property owners the ability to install a solar system with little or no immediate outlay of cash. Depending on the particular deal, the homeowner agrees to buy just the electricity or to pay a rental fee for the solar PV system or some combination. For the banks, this is practically risk free, especially if federal loan guarantees back up the initial purchase cost of the systems.

While some might consider these investments to be greenwash, they are meaningful to a sector that is just getting off the ground. The $40 billion or so already invested is likely to grow if public policy support doesn’t disappear.

Paul Ausick

The report shows that the DDR3 2GB contract price stayed flat at an average $10.75, but the DDR3 4GB ASP did fall slightly by about 4.6% to $20.50 because DRAM makers were increasing shipment volumes. Also noted, “From the market perspective, benefiting from production cuts by Japanese and a number of Taiwanese manufacturers, the spot market continually saw price rebounds. While the increases only lasted a few short days at a time, the effects of supply-side production cuts were enough to present the depressed spot market with a chance to recover slightly.”

This showed that the difference between contract and spot unit price for DDR3 2Gb chips has shrunk to 12%.  And the DRAM maker hopes… “finally putting an end to the dismal DRAM price trend of the past few months.”

Here is how brutal the trend was… Since June, the DDR3 2GB contract price fell over 40% to a low of $10.50.  Sadly, this breaks the cash cost for the majority of DRAM makers.  On this front it was noted, “PC OEMs’ September inventory restocking has been much better than in the previous few months, causing 2GB contract price to stay flat. Although the market currently remains in a state of oversupply, production cuts across the board have improved the DRAM oversupply situation and eased the price decline.”  As a result, some DRAM manufacturers have started quoting higher spot prices.

Micron Technology Inc. (NYSE: MU), Americas home-grown DRAM giant, is up 3.3% at $7.09 and its 52-week range is $5.18 to $11.95.  Freescale Semiconductor Inc. (NYSE: FSL) has been a dismal memory IPO but even its shares are up 1.8% at $12.45 and the post-IPO range is $9.43 to $20.97.

MEMC Electronic Materials, Inc. (NYSE: WFR) makes silicon materials for chips (and for solar) and its shares are trading flat at $6.80 versus a 52-week range of $4.96 to $15.04.  Unfortunately, MEMC seems to be lost.

DRAM is certainly not flash memory… Still, we cannot ignore that what may be good news for the DRAM players could ultimately end up being some of the same for flash makers.  A smaller independent DRAM and SRAM maker Integrated Silicon Solution, Inc. (NASDAQ: ISSI).  Its shares are up 1.6% at $8.56 and the 52-week trading range is $7.01 to $11.79.  SanDisk Corp. (NASDAQ: SNDK) is up 3% at $42.19 and its 52-week range is $32.24 to $53.61. There is also Spansion Inc. (NASDAQ: CODE) in NOR Flash and it is only up 0.5% at $14.08 with a 52-week range of $12.82 to $21.60.

Texas Instruments Inc. (NYSE: TXN) is also on many aspects of memory and components under the semiconductor sector.  Despite a cautious outlook given recently, TI’s stock is up 0.7% at $26.84 and the 52-week trading range is $24.11 to $36.71.

The Semiconductor HOLDRs (NYSE: SMH) ETF is up 0.7% at $29.80 today and the 52-week range is $25.87 to $36.99.  SPDR S&P Semiconductor (NYSE: XSD) is less liquid as an ETF, but it has a better representation of component weightings.  Its shares are up 0.8% at $47.08 against a 52-week range of $41.71 to $64.06.

When we covered our Technology Value Series in August, we warned about the potential warnings or lowering of estimates.  That has also come about.  We also noted that the calendar may work against the sector into September, but then the calendar is generally believed to be favorable for the sector on a historic basis.  We are now almost in the second-half of September.

We strongly suggest for traders and investors to understand all of the nuances and details of these leveraged ETFs, but there are two to consider if you truly believe that DRAM makers are going to have a marked improvement.  The 200% mover is the ProShares Ultra Semiconductors (NYSE: USD) exchange traded product and the 300% mover is the Direxion Daily Semicondctor Bull 3X Shares (NYSE: SOXL).  You are on your own on those.

Unfortunately, some of the market strength seen his morning is coming out and these winners are now not up as much as they were in the first 30 minutes of trading.

JON C. OGG

For all the action in solar there are only five companies that play in the sector that also have market caps above $1 billion. These are Applied Materials, Inc. (NASDAQ: AMAT), First Solar, Inc. (NASDAQ: FSLR), MEMC Electronic Materials Inc. (NYSE: WFR), GT Advanced Technologies, Inc. (NASDAQ: GTAT), and SunPower Corp. (NASDAQ: SPWRA).

24/7 Wall St. has taken a closer look into our solar screens.  If a value stock by the screens was purely China, we eliminated it because of the accounting woes and concerns facing that entire class of companies.  We took a look at the share price versus its 52-week range and versus Thomson Reuters consensus analyst price targets, as well as price/book ratios, forward P/E ratios, and other considerations.

There are always caveats in value screens, but that is particularly the case in the world of solar investing.  It used to be that solar was just a leveraged move on major oil price directional changes.  That is now a different situation entirely.

Applied Materials, Inc. (NASDAQ: AMAT) makes the equipment that solar PV makers use to manufacture cells and panels. The demand for the company’s equipment has risen as Chinese solar makers expand. How long the expansion continues will dictate how Applied fares. Shares recently closed at $10.73 and its market cap is $14.1 billion. The stock’s 52-week trading range is $10.30-$16.71. The current value is trading at a price-to-book ratio of about 1.65 to 1. Its forward price earnings multiple is 10.73. The company currently pays a dividend yield of 2.98% to investors. Thomson Reuters has a consensus price target of $13.88, implying roughly 29% upside to the most recent price.

First Solar, Inc. (NASDAQ: FSLR) is the largest of the solar PV makers by market cap, roughly 10x larger than any of Chinese competitors and more than 6x larger than its nearest US rival. The company’s thin-film panels are the industry’s low cost leaders, but falling prices for crystalline solar panels are pressing in, and the gap is now about $0.35/watt in First Solar’s favor. Shares recently closed at $84.96 and its market cap is $7.3 billion. The stock’s 52-week trading range is $85.96-$175.45. The current value is trading at a price-to-book ratio of about 1.99 to 1. Its forward price earnings multiple is 14.47. The company currently pays no dividend to investors. Thomson Reuters has a consensus price target of $139.53, implying roughly 64% upside to the most recent price.

The Solar Energy Industries Association (SEIA) and GTM Research today released a study showing that the US solar industry posted a $1.88 billion trade surplus in 2010.  Exports totaled $5.63 billion while imports totaled $3.75 billion. Polysilicon wafers and capital equipment were the two largest exports, while the largest imports came from finished solar photovoltaic modules. In other words, the technology-intensive part of solar PV manufacturing was a positive for the US, while the labor-intensive module manufacturing was outsourced, mainly to China and Mexico.

Silicon makers like MEMC Electronic Materials Inc. (NYSE: WFR) and Applied Materials Inc. (NASDAQ: AMAT) have struggled this year, while equipment maker GT Advanced Technologies Inc. (NASDAQ: GTAT) has done quite well. Solar PV providers like First Solar Inc. (NASDAQ: FSLR) and SunPower Corp. (NASDAQ: SPWRA) have both posted share price gains since the beginning of the year, but both are weakening as the outlook for the rest of this year gets revised downward.

The SEIA/GTM study also estimates the value creation for modules installed in the US in both 2009 and 2010. Here’s where the news for the solar industry is not so good. The development of polysilicon manufacturing in Asia — particularly in China — resulted in a -15% drop in value creation over the two years. The year-over-year cost difference was -19%. The new manufacturing capacity coming online from Chinese suppliers like LDK Solar Inc. (NYSE: LDK) and other large polysilicon makers is expected to drive costs even lower over the next few years.

Chinese polysilicon production in 2010 was less than 50,000 tons; by 2015, output is expected to reach 168,000 tons. The demand for solar PV installations will need to expand rapidly to soak up all that new production or prices will simply collapse.

Even GT Advanced Technologies (formerly GT Solar) is also likely to face competition from a new Chinese push into making solar and silicon manufacturing equipment. This could take a bit longer to happen, but when it does US exports of solar manufacturing equipment is also likely to get hurt.

As an historical document, the SEIA/GTM study provides a valuable look at the state of US players in the solar industry. But the historical evidence also leads to the notion that the trade surplus in solar PV is not likely to last much longer.

Paul Ausick