on signs of improving solar market even though profits have largely not been demonstrated. We, of course, are no where near a 52 week high. Instead, Wall Street is holding GTAT to a different standard. We apparently must show the profits and prove survivabiilty BEFORE we will be rewarded with some semblance of fair valuation. This of course is just with respect to the solar side of the business. We don't seem to be getting proper valuation in one or another business line, but which is it? Undervaluation on solar or sapphire? Or, no valuation on solar? No valuation on sapphire? Which is the laggard? Where is the problem?
Here is how I see the difference. The developments in the solar industry are tangible. The center of gravity has moved from Europe to the rest of the world and the projects and the scale of the market is really taking off. Panel prices are finally stabilizing and moving up. Some of these companies are clearly on the precipice of hefty profits - that is undeniable, hence the big move up in share price. None of that necessarily translates over to GTAT. While the solar companies announce almost every day big new contracts and projects in every corner of the world, what does GTAT announce - that they will have a new furnace next year! They have announced no tangible news of actual sales. The projections of profits for the 2nd half of 2013 are based on sales booked a long time ago. And because they have already written down so much of the their old sales, we can't even be certain that those sales are even going to be booked. We could get an announcement any day that the sales simply have not materialized and GTAT won't return to profitabiity until some time in 2014. That is possible. I hope that does not happen. I have 50000 shares in this company. On the other hand, we need to consider that many of these solar companies have started to cash in on their increased share price. First Solar has half a billion dollars to spend, Canadian solar just announced plans for $200 million in new money. I expect Jinko and others to feel pressured now to also do secondaries. So, the money is coming in and some of it hopefully will find its way to GTAT and then . . . to us!
If GTAT hits the earnings projection the company should be in the early stages of making shareholders a lot wealthier. TG has guided the street on 500-600 million in earnings for 13. Shorts are saying bs so we will find out in due time.
I guess I'll take you on your word on owning 50,000 shares. I just don't get why anybody would risk $200k on such a risky investment. There are much safer alternatives where you can make a decent return on such a large basis.
I put $5k in GTAT & $25k in Corning on the basis of this risk. It's important to me to make decent returns on large absolute amounts. I can't afford to lose spectacularly in hopes of winning spectacularly, which is why I invest less in GTAT.
Make no mistake about it, GTAT could go belly up. I obviously am hoping it doesn't, but this is not a steady blue chip in a developed industry. Solar is still volatile & the sapphire market is unproven.
Now of course, if $250k to you is what $5k is to me...happy investing & congratulations on your good fortune! That's where I want to be one day.
Does GTAT have significant solar customers that are NOT Chinese companies?
I've been counting on PPS price recovery for a couple of months now based ONLY on their solar business recovering as the rest of the solar industry has. A time lag makes sense while the Chinese players draw down their excess inventories. But will they be able to afford GTAT's furnaces after unwinding their current supply?
Are there other material solar customers?
OK I may have exaggerated a bit in the previous post, as "bucket shop"-type activity is at least supposed to be illegal for brokers. still, I bet MM's receive real time information on how many shares are held intraday by "pattern day trader" and margin accounts in each big brokerage and they make sure to account for those guys having to exit their positions at the end of the day, and take advantage of it.
so how does a drop on 100k volume "give away" the 1+ mil volume run up that preceded it? I just don't get how do you figure that's even possible.
The MM's/funds/share printers/whatever have decided to supply the market at a rate that made the price fall back down as soon as there was a lapse in demand. Later it recovered, again on much bigger volume.
daytraders don't move a damn thing in these markets. I doubt their trades ever leave the brokerage houses they are placing their bets in, especially if they trade on margin. It basically gets settled as a side bet.
It doesn't (and shouldn't) count as real demand for stock in the market.