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Shares of Yingli Green Energy (YGE) are holding steady this morning despite the Sell rating by Hapoalim Securities.
The analyst comment below courtesy of StreetInsider.com
“After updating our model to include: (1) higher ASPs (inline w/ YGE’s guidance),(2) higher shipments (above YGE’s guidance), & (3) lower poly-Si sourcing costs (which implies YGE works thru the majority of its excess poly-Si inventory), we are still below the Street for C3Q09; given our analysis suggests consensus is underestimating YGE’s minority interest & OPEX expenses, we see risk of neg. EPS revisions on the horizon…Despite a number of aggressive new assumptions/updates to our bottom-up YGE segment model (i.e., higher ASPs, higher shipments, quicker costs saves, & capacity ramping to 900MW in CY10), we are still notably below consensus EPS ests for C3Q09, CY09, & CY10; in short, where our model diverges from the Street is in our forecasts for YGE’s minority interest & OPEX expenses in 2H09/CY10, as well as the company’s CY10 ASPs; given YGE’s share price outperformance YTD (+99.8% YTD vs. +18.3% for S&P 500), we see outsized risk to the company’s forward valuation multiple ahead of Friday’s (11/13/09) pre-market earnings report.”
