Thursday, November 19, 2009

Trina Solar Q3 profit beats Street view (TSL)

Trina is becoming recognized as the class of the field. Of course, you knew that. And of course having implicit Chinese government backing helps. After trading up $1.74 yesterday the stock is up another $1.75 at $44.50* in early pre-market action.
From Reuters:

* Q3 profit $1.29/ADS vs Wall Street view $0.76

* Q3 revenue down 14 pct to $249.7 mln Nov 19 (Reuters) - Chinese solar company Trina Solar Ltd (TSL.N) posted a quarterly profit that beat Wall Street expectations, helped by higher solar module shipments, and said it was seeing a stronger demand in the fourth quarter.

The company posted a third-quarter net profit of $40.1 million, or $1.29 per American Depositary share, compared with a net profit of $18.9 million, or 71 cents per ADS, a year ago.

Net revenue dropped 14.1 percent to $249.7 million.

Analysts on average had expected 76 cents per ADS before items, on revenue of $216.3 million, according to Thomson Reuters I/B/E/S.

Solar module shipments rose 85 percent to 123 megawatts from year-ago quarter.

For the full year 2009 the company expects total PV module shipments to be between 380 MW and 400 MW, compared to its earlier view of between 350 MW and 400 MW....MORE

Here's the Wall Street Journal's take on the results:
Trina Solar 3Q Profit Rises 25% Amid Higher Margins

Trina Solar Ltd.'s (TSL) third-quarter earnings rose 25% amid a foreign-currency gain owing to the euro's strengthing against the dollar. Though sales fell on lower average selling prices, they rose sequentially and exceeded Wall Street's estimates.

The solar sector has been stabilizing in recent months. Trina in August reported stronger results but revenue fell on lower prices.

In September, Trina unveiled plans to help finance small, one-to-two-megawatt projects--each roughly enough to power 750 to 2,000 U.S. homes. The move followed similar actions by larger panel makers aiming to spur demand amid tight credit....MORE

*The stock is up 593% from its March low, which is why I wasn't too concerned (and decided against posting) this post from Schaeffer's Research:
Pre-Earnings Put Trading Picks Up Steam on Trina Solar Limited (TSL)

Trina Solar Limited (TSL: sentiment, chart, options) is slated to take the earnings reins tomorrow, and put players have rushed the option pits ahead of the event.

During the past couple of weeks, speculators on the International Securities Exchange (ISE) have bought to open more TSL puts than calls, as indicated by the stock's 10-day put/call volume ratio of 1.50. This reading registers in the 80th annual percentile, suggesting that TSL puts have been flying off the ISE shelves at a much faster pace than usual lately.

Echoing that trend, the solar concern on Tuesday saw roughly 3,400 puts cross the tape, nearly tripling its average single-session volume of about 1,300 puts. A healthy portion of the volume consisted of fresh eleventh-hour bets ahead of front-month options expiration, as put open interest at the November 40 strike skyrocketed from fewer than 500 contracts to almost 1,700 contracts overnight...MORE

The assumption being that these weren't informed, speculative bets on the results but rather were protective, intended to lock in profits should TSL disappoint.

Chart via PatternSpy:

TSL - Trina Solar ADR - Technical Analysis ChartTSL - Trina Solar Limited (ADR) - Weekly technical analysis chart, since 2006

Here's the conference call info:

Trina Solar Announces Conference Call to Discuss Third Quarter 2009 Results - Conference Call Time Change to 7:00 a.m. ET