Evergreen Solar (NASDAQ: ESLR) develops,
manufactures and markets solar power products. Its proprietary String Ribbon technology process is used to make photovoltaic cells that convert sunlight into electricity. These are the primary components of solar panels used to power such systems as highway call boxes, microwave stations, billboard lighting mechanisms and rural electric power sources. Most of the firm's sales involve customers in the United States.
Evergreen had good news for investors late last week. German-based Ralos Vertriebs GmbH signed a $750 million contract for solar panel deliveries, beginning in 2008 and extending through 2013. That boosted the company's sales total over the past two weeks to about $1 billion. Lazard subsequently issued positive comments on the stock, noting enhanced visibility.
ESLR shares
popped on the news and have now begun to consolidate the move in a bullish "flag" pattern. Prices frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.
Brokers recommend the issue with five "strong buys", eight "buys", eleven "holds", one "underperform" and one "sell". Analysts see a 35% average annual growth rate, through the next five years. The ESLR Price to Book ratio (2.38), Sales Growth rate (62.81%) and EPS Growth rate (-0.09 to 0.00 yr/yr) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 65% of the outstanding shares. Over the past 52 weeks, the stock has traded between $7.52 and $18.85. A stop-loss of $9.50 looks good here. Note that the firm is next expected to release quarterly results in late July.
Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold a position in the stock discussed above.
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