"Yingli Green Energy Holdings (NYSE: YGE) is recovering from a one-two punch from plunging oil prices and a massive short attack," says Jim Trippon in The China Stock Digest.
"The stock was driven down from a 52-week high above $40 to below $3. Such low valuations are not rational for an industry leader.
"As a vertically integrated company, Yingli is unique. The company turns raw polysilicon into ingots, slices the ingots into cells and then builds the modules that most of us in the West refer to as solar panels.
"Yingli takes its vertical integration one step further by assembling groups of panels into complex systems able to link into the electricity grid or into corporate electric power systems.
"This kind of integration has a distinct advantage in many ways. It gives Yingli control over the quality of its wafers. It also allows the company flexibility and consistency in the production of modules and full photovoltaic (PV) systems by embracing the industry’s entire value chain.
"Looking to the future, Yingli says its expansion plans remain on track. The company expects to be able to achieve an ambitious production capacity target of 600 MW before mid-2009, well ahead of schedule.
"Looking further ahead, Yingli is projecting earnings that have exceeded analysts’ expectations. The company says its fiscal 2008 net revenues will be in the estimated range of approximately $969 to $1.02 billion, which represents a 74.1% to 83.3% increase compared to fiscal 2007.
"Analysts were expecting the company to report revenues of $978 million for fiscal 2008. This is a huge increase from the end of 2007 when analysts were projecting net revenues of $901 million for the following year.
"We’re confident that Yingli will meet its projections. Yingli has a track record of exceeding expectations, a fact that indicates its corporate estimates are cautious and conservative. With a P/E multiple of just 5.56, Yingli is value priced for such a fast-growing company."
