LDK Solar Company (NYSE: LDK) is a leading manufacturer of the multicrystalline solar wafers used to produce solar cells and modules. The firm provides its wafers, as well as wafer processing services, to major manufacturers of photovoltaic products. More than two-thirds of its revenues derive from sales to companies in the Asia/Pacific region, primarily China and Taiwan.

The company pleased investors on Monday, when it reported Q2 EPS of $1.29 and revenues of $441.7 million. Analysts had been expecting 42 cents and $282 million. Management also guided Q3 revenues to $486-$496 million ($307.05M consensus) and FY08 revenues to $1.65-$1.75 billion ($1.16B consensus). The CEO noted that the firm had signed nine long-term wafer supply agreements year-to-date, further diversifying its customer base. On Wednesday, he announced yet another such agreement, with India-based XL Telecom & Energy.

The stock popped through 30-day, 50-day, 90-day and 200-day moving average resistance on the news and has since moved into a bullish "pennant" consolidation pattern. Prices frequently exit pennants moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the issue with one "strong buy", one "buy", five "holds" and two "sells". Analysts expect a 58% average annual growth rate, through the next five years. The LDK PEG ratio (0.41), Sales Growth rate (345.94%), EPS Growth rate (344.83%), Operating Margin (25.33%), Net Profit Margin (24.76%), Return on Assets (15.44%), Return on Investment (25.46%) and Return on Equity (38.53%) compare favorably with industry, sector and S&P 500 averages. Over the past 52 weeks, the stock has traded between $19.64 and $76.75. A stop-loss of $35.40 looks good here.

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.