To start the day, we are going to be exiting at least one maybe two or three positions. We will start with our Midterm Trade in Solarfun Power Holdings (SOLF). The company reported an EPS of 0.69 vs. the expected 0.49. The company beat revenue estimates, upped its outlook on shipments for the full year, but dropped its Q4 expectations due to internal capacity. With the run up the stock had into earnings, there could not be a single negative aspect of its earnings. SOLF will be opening down 3-4%, but we have still made a significant amount and will sell out of the open for around 10-11% gain.
(Solar information firm iSuppli’s forecast for growth in 2011 above…looks solid!)
CSUN was opened yesterday at 4.76 for a Play of the Week. The stock got good news from LDK (up 8% in pre-market) and from JA Solar (up 5%). Solarfun was somewhat disappointing, but if the stock had not jumped 15% into earnings, it would be up as well with its earnings. Overall, Q3 is strong for solar and Q4 looks bright moving forward. We are looking to exit this position from 4.89 and up. Dryships (DRYS) was one of our pickups as well yesterday from the $5 List. We entered at 4.84, and we are looking to only make a small gain with target exit range at 4.92 – 4.97. The stock looks like it will open in the range. Finally, we still have our short sale in Green Mountain Coffee Roasters (GMCR). I will look to close that position today.
Let’s get into some plays for today…
Buy Pick of the Day: First Solar Inc. (FSLR)
Analysis: The story in solar for Q3 has been pretty solid thus far with every reporting company thus far beating expectations, raising forecasts, and looking rosy moving forward. First Solar, since its earnings though, has not had a major run up. The stock is one of only the solar stocks to show undervaluation on RSI. With today’s earnings looking to prop up the sector, First Solar has a ton of upside and looks poised for some nice quick gains.
JA Solar is now up over 8% in pre-market, LDK is up almost 10%, and SOLF has dropped more. Yet, other companies that did not report are in the green not red. First Solar should benefit from its peers doing so well…
