(This is an excerpt from an article I originally published on Seeking Alpha. Click here to read the entire piece.)
ReneSola (SOL) went from a tremendous 2010 – gaining 84% and as much as 206% – to a complete collapse in 2011. On the heels of several disappointing earnings reports this year, SOL has dropped 66% and is approaching all-time lows from 2008 and 2009.
*Chart created using TeleChart
A funny thing has happened to SOL throughout this period. Its balance sheet has improved most of the way down. For at least four straight quarters, SOL has increased its cash and cash equivalents. Cash has gone from $171M at the end of June, 2010 to $438M at the end of June, 2011…{snip}… With a valuation that has sent shares well below book value (0.4), price-to-sales of 0.2, and a forward P/E of 5, it makes a lot of sense that SOL’s management has stepped up to repurchase shares. SOL has authorized up to $100M for these repurchases.
{snip}
Given this vote of confidence in the company and fundamentals that suggest the company will survive a solar recession, I am adding ReneSola to the list of solar stocks to pick from the rubble.
Be careful out there!
(This is an excerpt from an article I originally published on Seeking Alpha. Click here to read the entire piece.)
Full disclosure: long SOL