Perhaps a bit of the shine is wearing off of solar stocks. Solar panel company ReneSola (SOL) turned in a third-quarter loss of $10.2 million, or seven cents per share, compared to earnings of 23 cents per share ($32.4 million) a year ago. Quarterly revenue fell to $141 million from $216 million a year ago. Expectations called for a loss of eight cents per share on revenue of $135.5 million.
The company stated, "We witnessed a strong rebound in customer demand for our quality products in the third quarter of 2009 and reached a corporate landmark as ReneSola achieved the highest quarterly shipments of solar products in its history." I'm not buying it. SOL saw earnings and revenue walk off a cliff when compared to a year ago ... so let's make sure that we talk about great customer demand. Of course, customer demand wasn't good enough to help you swing to a third-quarter profit.
Technically, the sun is setting on this once solid stock. During the height of soaring solar stocks, SOL traded in the upper $28 region, but you can now own a share of SOL for the bargain basement price of roughly $4 per share. Of course, that is if you feel like watching your $4 waste away. The stock faces downside pressure from its 10-month moving average, which served to cap the shares in their latest rally attempt. Perhaps today's bad-but-not-as-bad-as-expected earnings report will spark a bit of life in the stock, but the equity faces too much technical resistance to even consider it as a bargain play.
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