SPWRA recommended as one of the better solar plays due to its geographical go to market positioning...
Shares of solar energy technology provider Energy Conversion Devices (ENER) are down 77 cents, or 24%, at $2.39, after the company yesterday afternoon warned that changes in subsidies in France and Italy may cut its revenue this quarter by as much as 50%.
CEO Mark Morelli remarked, “The dramatic and abrupt shift in the French and Italian solar incentive structures has impacted our business and forced us to reconsider our near-term financial outlook.”
However, Jefferies & Co.’s Jesse Pichel warns against drawing too broad a conclusion from Energy Conversion’s woes.
The company is “uniquely worse off in Italy,” he writes, with the 75% of its sales coming from that country and from France. Italy was in fact 45% to 50% of the December quarter’s sales, he notes.
“Tier One brands can reallocate,” he believes, and projects will resume in Italy in the second half of this year once subsidy issues are settled.
Pichel recommends Satcon (SATC), Sunpower (SPWRA), Yingli Green Energy (YGE), and Trina Solar (TSL).