TSL

[David Randolph]

Thanks for your answer and info  BigSully1 .

It is my understanding that Trina uses Monocrystalline Silicone which is much cheaper to produce than Polysilicone.

I've searched for explanation on this issue and found the following link, curiously at HOKU's website:

HOKU scientific - Solar Basics

My highlights are:

«There are two processes for making ingots from polysilicon: the monocrystalline and the multicrystalline process. To make monocrystalline ingots, a single crystal of polysilicon is grown, whereas, multicrystalline ingots are made by melting chunks of polysilicon together in a crucible to form a large block of multicrystalline polysilicon, which is then cut into smaller bricks. The monocrystalline ingot or the multicrystalline brick is then cut into thin wafers, typically using a cable saw. The end product is either a monocrystalline or a multicrystalline silicon wafer.»

«PV cells made from multicrystalline wafers may have efficiencies in the range of 13-18%, whereas PV cells made from monocrystalline wafers typically have higher efficiencies in the range of 20%, but are more expensive to produce.»

It seems the monocrystalline process is the most expensive, yet more efficient.

At first sight I don't find evidence of TSL having a cost advantage over its competitors, what do you think magu? Thanks

For now I'll maintain my estimates for TSL, and will only sell at the optimal selling price of $86.5.

[berloga]

Efficiency is the key in producing the energy, yet cost is sure a factor. I don't think it cost a lot more to produce the monocrystal type silicon. It also may be more durable.

David, take a look at WFR. It is a large manufacturer of polycrystal silicon. I sold it at $38 and it is $65 now, as always with no model in mind...

[David Randolph]

Efficiency is the key in producing the energy, yet cost is sure a factor. I don't think it cost a lot more to produce the monocrystal type silicon. It also may be more durable.

David, take a look at WFR. It is a large manufacturer of polycrystal silicon. I sold it at $38 and it is $65 now, as always with no model in mind...

I'll look at WFR, just put it on my "stocks to cover list". But it is already a $15 B market cap company, I'm more interested in smaller plays.

As for TSL, the crowd keeps saying bearish things about it, yet the stock is building the basis for another bull run. My valuation model says "sell at the optimal price of $86.5". I'll do that when I have the chance, in the meantime I'll keep on holding TSL.

[David Randolph]

I've just noticed that TSL and JASO are the second and third less attractive stocks of the Main Portfolio. And this with pretty strong and optimistic views of the future, which concerns me.

And what if, instead of a 3% dilution we get, say, 6% dilution because these are recent Chinese IPO stocks, and we know how the Chinese like to dilute.

And, if instead of a 10% net profit margin, we get just 5%. I'll maintain a revenue CAGR of 100% (2 on the model) and a 35 times earnings multiple.

Let's check the valuation model under these changes:



The changes are quite dramatic, and the risks are very real in my opinion. I decide to take my 36% profit on TSL and look for better opportunities. The trading plan for TSL is SELL.

[BigSully1]

I've just noticed that TSL and JASO are the second and third less attractive stocks of the Main Portfolio. And this with pretty strong and optimistic views of the future, which concerns me.

And what if, instead of a 3% dilution we get, say, 6% dilution because these are recent Chinese IPO stocks, and we know how the Chinese like to dilute.

And, if instead of a 10% net profit margin, we get just 5%. I'll maintain a revenue CAGR of 100% (2 on the model) and a 35 times earnings multiple.

Let's check the valuation model under these changes:



The changes are quite dramatic, and the risks are very real in my opinion. I decide to take my 36% profit on TSL and look for better opportunities. The trading plan for TSL is SELL.

Yes I think you did right selling David. I already sold half the day of the last 16% rally. Sold the rest today. Also sold SPWR today.

[jorgegr]

David:
You made an excellent job on this stock - applaud

[BigSully1]

TSL ugly earnings miss.  Bringing down solar stocks today?

[bjc]

I think TSL is worth another look right now.  Killed earnings, seems like they are doing some work in house that is saving costs.

Nice margins.  The stock reacted to the earnings decently well and then has since fallen to before the ER point.  If solars aren't completely worthless as they have recently traded, then TSL will be a great investment.  The stock trades at about a 21 trailing PE after announcing $0.61 in the most recent quarter.