If I listened to analysts over the years I'd of dr...

2007-12-20T17:35:00.000-05:00

If I listened to analysts over the years I'd of dropped out of the market years ago. These are people downgrading the financials in the past 2-3 weeks.

Simple case for LDK - its an arms supplier to the PV panel makers. Gross margns will probably end up in 25-27% range in near term, on a large revenue ramp and we have (a) accounting issue if not resolved put to bed (for now) (b) new guidance (c) another quarter in the bag (d) a better idea of the year ahead (e) Qcells one of the most influential companies in the industry is now in bed with LDK

ASPs should decline in 2008 for the PV makers but they will still need wafers. Just like they will need JASO for cells. It's not going away.

LDK at $70 probably did not discount 30% or below margins. I was having a hard time getting on board they would keep those margins myself, but now we have a more reasonable assumption of 25-30%. I expect that to be the range next 6 quarters and then it will uptick once they get the plant going. Although people say plant will be ready by end of 2008 I wont count on it until mid 2009. So until then you have a labor intensive industry with polysilicon prices higher than usual for next quarter in the spot market but 75% of supply for 2008 secured, and a new paradigm of 25-30% gross margins in a sector with unquenched demand. I can live with that in the $40s and $50s. I expect about $1.50 EPS in 2008 as the worst case, and if polysili prices fall in 2nd half of 2008, there should be good upside from there.

Re: LDK. Goldman placed it on the Conviction SELL...

2007-12-20T16:39:00.000-05:00

Re: LDK. Goldman placed it on the Conviction SELL list, and Piper downgraded it to Sell with a ~34 price target. What are you seeing that they aren't? Can you rehash a little bit on why you think its such a good buy here while analysts are so negative on it?

Piper: Downgrade details (66.11 ) -Update : Piper downgraded LDK to Sell from Neutral and maintains their $34.50 tgt following earnings. Firm says that uncertainties still exist with respect to LDK's low turns of 2.2x, unsubstantiated contract supply with 25% exposure to spot, high risk polysilicon ramp with targets they assess as overly aggressive, and numerous shareholder law suits.

Goldman: Goldman Sachs analyst Cheryl Tang added the stock to her Conviction Sell List, and held a price target of $33 per share.

Comments on Fund My Mutual Fund: Bookkeeping: LDK Solar (LDK) Hits Targets

If I listened to analysts over the years I'd of dr...

Re: LDK. Goldman placed it on the Conviction SELL...