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ReneSola Stock: Metrics Paint Grim Picture

ReneSola Ltd. (SOL) designs, builds, operates and sells solar power projects in the United States and Europe. I am bearish on the stock. (See SOL stock charts on TipRanks) The...
ReneSola Stock: Metrics Paint Grim Picture © Reuters. ReneSola Stock: Metrics Paint Grim Picture

ReneSola Ltd. (SOL) designs, builds, operates and sells solar power projects in the United States and Europe.

I am bearish on the stock. (See SOL stock charts on TipRanks)

The PolySilicon Crisis

After falling rapidly for over a decade, Solar module prices have taken an upturn for the worse in 2021.

The catalyst for the higher cost of production is the shortage of polysilicon. This was initially caused by pandemic supply chain disruptions, and subsequently amplified by panic buying, as manufacturers' fear of implied inflation intensified.

Renesola has definitely felt macro-economic factors as it recently missed its Q2 revenue estimate by $2.22 million, and reduced its initial Q3 revenue guidance to $19 million to $21 million, from its previous estimate of $26 million.

Valuation Metrics

From a valuation vantage point, the stock's price is inflated. Relative to the sector, its EV/EBITDA (50.9) is overvalued by 258.9%, and its price-to-sales (5.2) is overvalued by 228.2%.

A PEG ratio of 29.6, and a forward PEG of 31.4, means any argument for hypergrowth would be invalid.

Ideally, you'd like your PEG to be at or below 1.0, as this indicates that the company's growth justifies the price that the stock's trading at.

Wall Street's Take

Wall Street thinks the stock is a Moderate Buy, with two Buys, and one Sell assigned in the past three months. The average SOL price target of $11.35 implies 58.7% upside potential.

Most analysts see the PolySilicon crisis as transitory and think that the U.S. infrastructure bill and net-zero emissions push will support ReneSola.

On the other hand, the renewable energy space is becoming increasingly competitive. Stocks won't simply do well because of an industry trend, and they need to justify performance with high-quality pricing and valuation numbers, which ReneSola doesn't have at the moment.

Disclosure: At the time of publication, Steve Gray Booyens did not have a position in any of the securities mentioned in this article.

Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of TipRanks or its affiliates, and should be considered for informational purposes only. TipRanks makes no warranties about the completeness, accuracy or reliability of such information. Nothing in this article should be taken as a recommendation or solicitation to purchase or sell securities. Nothing in the article constitutes legal, professional, investment and/or financial advice and/or takes into account the specific needs and/or requirements of an individual, nor does any information in the article constitute a comprehensive or complete statement of the matters or subject discussed therein. TipRanks and its affiliates disclaim all liability or responsibility with respect to the content of the article, and any action taken upon the information in the article is at your own and sole risk. The link to this article does not constitute an endorsement or recommendation by TipRanks or its affiliates. Past performance is not indicative of future results, prices or performance.

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28-09-2021 02:42:48 (UTC+7)

EUR/USD

1.1698

-0.0016 (-0.14%)

Summary

Neutral

Moving Avg:

Buy (6)

Sell (6)

Indicators:

Buy (5)

Sell (1)

EUR/USD

1.1698

-0.0016 (-0.14%)

Summary

Neutral

Moving Avg:

Buy (6)

Sell (6)

Indicators:

Buy (5)

Sell (1)

GBP/USD

1.3706

+0.0024 (+0.17%)

Summary

Sell

Moving Avg:

Buy (4)

Sell (8)

Indicators:

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USD/JPY

111.00

+0.28 (+0.26%)

Summary

Neutral

Moving Avg:

Buy (8)

Sell (4)

Indicators:

Buy (2)

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AUD/USD

0.7292

+0.0034 (+0.47%)

Summary

↑ Buy

Moving Avg:

Buy (12)

Sell (0)

Indicators:

Buy (6)

Sell (1)

USD/CAD

1.2624

-0.0028 (-0.22%)

Summary

↑ Buy

Moving Avg:

Buy (11)

Sell (1)

Indicators:

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EUR/JPY

129.87

+0.17 (+0.13%)

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Moving Avg:

Buy (3)

Sell (9)

Indicators:

Buy (1)

Sell (6)

EUR/CHF

1.0832

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Gold Futures

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Silver Futures

22.668

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Copper Futures

4.2858

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Crude Oil WTI Futures

75.44

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Brent Oil Futures

78.64

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Natural Gas Futures

5.854

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US Coffee C Futures

194.98

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Euro Stoxx 50

4,165.48

+6.97 (+0.17%)

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↑ Sell

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S&P 500

4,450.00

-5.48 (-0.12%)

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DAX

15,573.88

+42.13 (+0.27%)

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FTSE 100

7,063.40

+11.92 (+0.17%)

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Hang Seng

24,208.78

+16.62 (+0.07%)

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Buy (10)

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US Small Cap 2000

2,290.65

+36.77 (+1.63%)

Summary

↑ Sell

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Buy (4)

Sell (8)

Indicators:

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IBEX 35

9,002.90

+129.80 (+1.46%)

Summary

Buy

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Buy (7)

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BASF SE NA O.N.

64.740

+1.040 (+1.63%)

Summary

↑ Sell

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Bayer AG NA

47.47

+0.99 (+2.13%)

Summary

↑ Buy

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Buy (12)

Sell (0)

Indicators:

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Allianz SE VNA O.N.

196.19

+3.85 (+2.00%)

Summary

↑ Buy

Moving Avg:

Buy (12)

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Buy (6)

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Adidas AG

278.80

-2.77 (-0.98%)

Summary

↑ Sell

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Deutsche Lufthansa AG

6.561

+0.328 (+5.26%)

Summary

↑ Buy

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Siemens AG Class N

147.27

-0.84 (-0.57%)

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Deutsche Bank AG

11.120

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 EUR/USD1.1698Neutral
 GBP/USD1.3706Sell
 USD/JPY111.00Neutral
 AUD/USD0.7292↑ Buy
 USD/CAD1.2624↑ Buy
 EUR/JPY129.87↑ Sell
 EUR/CHF1.0832↑ Sell
 Gold1,750.85Neutral
 Silver22.668↑ Sell
 Copper4.2858↑ Buy
 Crude Oil WTI75.44↑ Buy
 Brent Oil78.64↑ Buy
 Natural Gas5.854↑ Buy
 US Coffee C194.98↑ Buy
 Euro Stoxx 504,165.48↑ Sell
 S&P 5004,450.00Buy
 DAX15,573.88↑ Sell
 FTSE 1007,063.40↑ Sell
 Hang Seng24,208.78↑ Buy
 Small Cap 20002,290.65↑ Sell
 IBEX 359,002.90Buy
 BASF64.740↑ Sell
 Bayer47.47↑ Buy
 Allianz196.19↑ Buy
 Adidas278.80↑ Sell
 Lufthansa6.561↑ Buy
 Siemens AG147.27↑ Sell
 Deutsche Bank AG11.120↑ Buy
Mua/Bán 1 chỉ SJC
# So hôm qua # Chênh TG
SJC Eximbank5,665/ 5,715
(0/ 0) # 900
SJC HCM5,635/ 5,700
(0/ 0) # 885
SJC Hanoi5,635/ 5,702
(0/ 0) # 887
SJC Danang5,635/ 5,702
(0/ 0) # 887
SJC Nhatrang5,635/ 5,702
(0/ 0) # 887
SJC Cantho5,635/ 5,702
(0/ 0) # 887
Cập nhật 28-09-2021 02:42:50
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ↀ Giá vàng thế giới
$1,750.42+0.920.05%
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Sản phẩmVùng 1Vùng 2
RON 95-IV2204022480
RON 95-II,III2194022370
E5 RON 92-II2071021120
DO 0.05S1658016910
DO 0,001S-V1693017260
Dầu hỏa1564015950
ↂ Giá dầu thô thế giới
WTI$75.42+0.270.36%
Brent$79.42+0.440.55%
$ Tỷ giá Vietcombank
Ngoại tệMua vàoBán ra
USD22.630,0022.860,00
EUR25.993,7727.346,60
GBP30.324,2231.591,18
JPY200,45212,05
KRW16,7520,39
Cập nhật lúc 18:54:42 27/09/2021
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