A spate of positive reports helped support solar stocks this week - even as one big loser emerged in the solar-equipment space.
Perhaps the most closely watched solar company of the week was First Solar (NASDAQ: FSLR), the Arizona-based solar-module producer. Credit Suisse analysts hiked their price target on the stock, saying the company's participation in the Antelope Valley solar project in California would add to 2011 earnings. The 230-megawatt solar installation was approved recently by state regulators.
Credit Suisse raised First Solar's price target from $150 to $160.
First Solar stock rose on the news, reaching its highest price since early May. And one major shareholder - the Walton family, of Wal-Mart fame - opted this week to sell about 280,000 of its First Solar shares.
Other solar stocks made news too, though.
Investor attention turned to Chinese solar companies, which have performed extraordinarily well in 2010. Bloomberg noted Friday that Solarfun (NASDAQ: SOLF) - a solar-module producer - has gained 73 percent during this quarter alone.
"In the long-term, the Chinese will probably be the winners" in the solar market, Allianz RCM analyst James Britland said to the news service. Chinese firms' ability to price panels well below American and German solar companies is a substantial competitive advantage, Britland noted.
Also giving Chinese solar companies a boost, Bloomberg said, is Chinese government assistance. Solarfun, Yingli Green Energy (NYSE: YGE) and Suntech Power Holdings (NYSE: STP) have received $20 billion in loans from China's government, which is eager to see Chinese green-energy companies succeed.
Other Chinese solar stocks of note, Bloomberg reported, are JA Solar Holdings (NASDAQ: JASO) and Renesola (NYSE: SOL): They are two of the five best performers in the solar sector.
JA Solar isn't currying everyone's favor, however. Analysts at Axiom Capital reiterated this week their "Sell" rating on the stock.
And one solar-equipment company saw its shares slump in the middle of the week. Power-One (NASDAQ: PWER), which makes inverters, plummeted more than 13 percent Wednesday on concerns about a drop in solar demand next year.
With Germany and Italy both set to slash solar subsidies in 2011, the market for solar modules could contract. Just how much it will shrink is anyone's guess - but, in the long term, the best performers may be the solar-module manufacturers who can produce panels cheaply.
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