Goldman says Trina profits will rise 5.6% for every percentage drop in the Yuan:
As dust starts to settle, we want to know how a cheaper yuan impact the earnings of Chinese companies. Does China Southern Airlines deserve losing 14% of its market value?
Goldman Sachs provided us with a list.
Two mining companies Zhaojin Mining Industry (1818.Hong Kong) and Zijin Mining (2899.Hong Kong) will benefit quite a bit from a cheaper yuan. Goldman estimates that for every percentage depreciation in yuan versus the dollar, Zhaojin and Zijing will see their earnings rise by 8.7% and 8.3%. Yesterday, Zhaojin and Zijing rose 5.7% and 8.5% respectively.
Solar company Trina Solar (TSL) is also a major beneficiary. Its earnings will rise by 5.6% for every percentage drop in yuan.
The tariffs apparently are retroactive, otherwise a reduction for the 2012 case would be meaningless. So, a positive for the 2012, a negative for recent and going forward. Will those be recognized this (3rd quarter) when CSIQ became aware or for past quarters? Thanks.
Don't know the answer but that was one of the factors in Goldman establishing the effect of the Yuan devaluation on companies such as Trina. For Trina, they determined an increase of profit equal to 5.6% for every 1 percent decrease in the value of the Yuan. 3 to 4 % decrease in the Yuan this week bodes well. I'm assuming that 5.6% took into account the denomination of debt, manufacturing and export cost changes and I'm hopiing it also included foreign currency effects on sales to China.
I believe it would trigger gain to Yahoo on the appreciated shares. Then, it would be taxable to the shareholders, as well, (unless the shareholder is an IRA, etc).........but still tax at Yahoo's level.
They are not going to try and spin off baba shares without an IRS ruling. Would be disastrous with tax and penalty if they tried it.
EBITDA is always bigger than earnings. The "B" stands for before. Earnings before subtracting interest, taxes, depreciation and amortization.
Every time I try that the stock goes up then I buy it back too soon. I have found that I'm better off to hold and not try and time it.
I think the market has yet to hit its low. Despite the double bottom there has been no true capitulation. I think it needs to test the 1820 level before all is clear. I've moved into some small market short positions through SQQQ and SRTY. Will add to these if I see more deterioration. Would be nice to pick JKS back up below 20. Patience is hard for me but I'm learning.
I sold yesterday at a $26.28 average price. Next week is options exp and the market is feeling overbought to me. Maybe end of day or maybe Monday I think we get some selling. Looking to pick Jks back up sub $23 by next Friday. Good luck.