Cart (0)
VIDEOTicker Shock: Five Reasons LDK Solar Looks Dim
Monday's top stories and stocks with potential to move.
 |
|
Asian stocks took a bit of a hit. The Hang Seng was off 1.23% and the Nikkei was down 1.38%. Meanwhile, European stocks were in negative territory earlier this morning as well. And here in the US, we're currently trading lower.
Here’s what I’m focused on this fine Monday morning:
LDK Solar (LDK):
The China-based solar company shed some light on its second-quarter sales expectations. According to a release: “For the second quarter of 2009, LDK Solar estimates shipments between 220 and 230 megawatts ("MW"). This compares to its previously issued guidance for the second quarter of 2009 of wafer shipments in the range of 200 to 220 MW. The company expects to record between $215 and $225 million in revenues.”
The issue there is that the Street is at about $247.2 million.
My thoughts:
1. The first thing that comes to mind is that we could see full-year expectations coming down in the weeks ahead. That would be a negative if it were to happen.
2. Even if that doesn’t happen, the company is expected to earn just $0.03 a share this year, so it’s tough to get too excited about the situation.
3. Data indicates that the company missed EPS expectations in each of the last 2 quarters. It's going to have to get on the ball if it wants the Street to really warm to this story.
4. I understand we're living in a world economy and it’s not uncommon for public companies to be based overseas. Call me a nervous Nellie, but I’m not too keen on the fact that the company is based in China.
5. With fuel prices on the rise, investors and consumers might start to give more love to alternative-energy companies and the stock could get a lift. But that’s a big maybe.
I’ll keep an eye peeled. But with better opportunities out there, I’m steering clear for now.
Matrix (MTXX):
I’ve had people ask me whether or not I thought it was time to bottom-fish the shares. (For those unaware, the shares have been under some pressure as a result of the Zicam debacle.) My thoughts:
1. Zicam accounted for a pretty sizable portion of the company’s revenues, so understandably, it's a bit of a concern.
2. The stock price had fallen off a cliff. And to be honest, I’m not exactly expecting a V- shaped recovery, given the apparent seriousness of the situation.
3. Even if the shares were to show some signs of life, it could take investors a little time to warm to this story once again.
4. If the stock stays in the tank, I’m a bit concerned about what might happen during tax-loss selling season.
5. What happens if the shares fail to maintain the $5 mark? (Note that it's currently over $6, though).
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
