Two key solar stocks are being hit hard in early indications. First Solar, Inc. (NASDAQ: FSLR) and SunPower Corporation (NASDAQ: SPWRA) have both been downgraded to "Sell" from the prior "Buy" ratings over at Goldman Sachs. The fallout from these calls may create new issues for the sector which has already seen its key components chopped down in the current market.
It seems all of the talk of a solar supply being in over-supply by 2010may be making Goldman Sachs rethink some of the long-term models. Thecurrent credit market is also going to make the financing of new solarprojects a tighter issue than before, even when you consider the taxcredit renewals that are being put into law to include utilities forthe first time.
SunPower shares are not indicated down that much, and its recentticker change from "SPWR" may have traders not looking at it so much.But First Solar shares are being given roughly a $10.00 haircut tounder $150.00 and its 52-week trading range is $124.96 to $317.00.
Goldman Sachs does not follow many of the other solar stocks, but companies such as Canadian Solar Inc. (NASDAQ: CSIQ) and LDK Solar (NYSE: LDK) are possibly going to be down in sympathy with the call even if they aren’t a part of the research call.
Jon C. Ogg
October 7, 2008