LDK Solar (LDK) Reports Solid Results

In one of the most anticipated reports ever? hah - LDK Solar (LDK) reported a $0.37 EPS which matched analysts estimates. Revenue came in at $158.7M vs analysts expectation of $143.2M

Gross margin was down to 30.8% of revenue, lower than previous quarters but still high considering this space. (solar in general)

Guidance for next quarter is $180-$185M revenue with EPS of $.40 - $.43 vs analysts estimates of $167.5M in revenue and $0.41 EPS.

At this time most solar 'investors' (speculators) only care about revenue growth, and with 60% sequential revenue growth this should satisfy the rabid appetite for revenue growth. The law of large number begins to hit as next quarter's sequential growth will slow down....

Some day minor things like gross margins and net margin levels will matter in the solar space, but at this time it's all about revenue from the reactions of watching which stocks are 'favored' and which are put in the dog house. Hence why it's hard for me to value these stocks because measures that matter to me, such as margins do not matter for the type of people who run these stocks up 80% in 3 days. :)

How the stock of LDK Solar will react is anyone's guess as this stock is full of every type of investor, daytrader, momentum trader, short, and all believe adamently they are correct. I call this a 'battleground' stock, much like a Crocs (CROX). I will be hoping for a pullback to some key gap levels such as $60 before adding any to my small position. (There is a nice gap down south of $46 which would be even more tasty)

Either way, best to stand aside and let the battle play out and then enter once the dust is settled. Margin guidance on the conference call will also be interesting, especially if they mention longer term guidance (out past 1 quarter)

Long LDK Solar in fund; no personal position