Yingli Green Energy Holding boosted its second-quarter module shipment outlook and backed its gross margin forecast, but its shares fell 7 percent as the Chinese solar panel maker did not provide a much-expected update for the second half.
The solar market likely bottomed in the second quarter, after pullbacks in solar subsidies in the world’s No. 2 market Italy stalled development of projects there, creating an oversupply of solar panels and sparking a more than 20 percent drop in prices.
A number of solar companies, including Trina Solar, have already indicated that a strong second-half show will make up for the disappointment in the first.
“We urge investors not to get too excited as Yingli did not provide an update on the second half, which will likely fall short of Street estimates due to pricing/margin headwinds,” said Wells Fargo Securities analyst Sam Dubinsky.
Yingli expects April-June module shipments to rise by 35-37 percent over the January-March quarter, compared with its prior forecast of more than 30 percent increase.
The company backed its second-quarter forecast of a low-to-middle twenties percentage gross margin.
“Street looks high for second half,” Dubinsky said.
“We expect pricing headwinds to offset the benefits of higher unit shipments… We estimate quarterly EPS in the $0.10-0.15 range in the second half versus the Street at $0.27-0.28.”
On Tuesday, Trina Solar cut its forecast for second-quarter module shipments and gross margins, saying subsidy cuts in Italy slowed demand and led to high inventory.
Shares of the Baoding, China-based Yingli fell to a two-year low of $6.67 on Wednesday on the New York Stock Exchange. They were down 4 percent at $6.84 in late morning trade.
