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Cypress Semiconductor Corporation Message Board

  • abdoolilonamer6jcr abdoolilonamer6jcr Jan 15, 2006 3:28 PM Flag

    Woah! This is tremendous CY!

     
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    • Jeff,

      yes, there is aboslute no weakness in solar industry among any of SPWR's peers. The conversion ratio in polysilicon solar had been improved dramatically in past few years. Solar use is no longer so inefficient compared with traditional electricity. But from the report I read, I feel (it's my own interpretation) that Booking is not the sole or only criticial element to determine the future of SPWR. Other factors include:

      1) Current P/S ratio already reflects lots of optimism. One can say that is still conservative. Hard to really justify at current juncture. When I say - "story" stock, the first story is California panel decision, the second will be earning report.

      2) Short-term margin constraint: Somewhere I read that some solar makers already stop to accept orders beyond 6 months. You can interpret as strong booking; you can also interpret as uncertain pricing. With polysicilicon shorage squeezing in the cost, with customers' sensitive pricing conscience squeezing on sale price (SPWR's customers need to be always assurred with the relative competitiveness against utility supply), Solar makers may see sandwich effect in its profit margin in 2006, which makes long-term booking not so meaningful. Polysilicon is not something hard to make, but the fab expansion lead time is about 18 months. So short-term wise, SPWR may see constraint on earning expandibility. Beyond 18 months, SPWR may find a strong corelationship between stock price and its growth.

      3) Although I am not absolutely sure, I have the impression that SPWR's 2006 revenue estimate already reflected full factory utilization with its 100 MW production capacity by the end of 2006. They might not be able to achieve better revenue.

      Hope this help.

      P.S. SPWR is the only one I heard of advanced booking into 06,07 &08. Again, I don't know it means that their products more preferable, or not very meaningful due to above.

 
CY
15.16-0.24(-1.56%)Mar 3 4:00 PMEST

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