We maintain our Neutral stance on
JA Solar Holdings Co., Ltd.
), which is one of the most cost-efficient solar cell producers
with a geographically diversified customer base. Its customer base
spans across Germany, Italy, U.S., Spain, India, Korea, China and
Japan. The company effectively uses its locational advantage in
China, with Chinese low-cost solar module manufacturers
contributing a substantial portion of its revenue.
JA Solar has been able to manufacture high quality, high
efficiency products at lower costs in comparison to most of its
peers with the help of its technological innovations. Also, in the
near term, the company expects to improve its newer generation
solar cell technology that will make its solar cells reach
commercial efficiency of 20%.
JA Solar meets its capital obligations mainly through low cost
borrowings. Moreover, it is capitalizing on its strong balance
sheet in funding near-term expansion programs through cash on hand
and operating cash flow that helps in maintaining a strong market
However, we are concerned over the tepid module demand in
Europe, rising competition, wafer dependency, the financial
stability of its customers and the oversupply of solar cells in the
The company presently retains a short-term Zacks #3 Rank (Hold)
that corresponds with our long-term Neutral recommendation on the
Based in Ningjin of the Hebei province in the People's Republic
of China, JA Solar manufactures high-performance solar cells. JA
Solar's principal customers are solar module manufacturers who
assemble and integrate its products into modules and systems. The
company sells primarily to customers in China, Europe and the U.S.
The company has also entered into the new markets of Greece,
Portugal, France, Italy and South Korea.
The company mainly competes with
Suntech Power Holdings Co. Ltd.
JA SOLAR HOLDGS (JASO): Free Stock Analysis
SUNTECH PWR HLD (STP): Free Stock Analysis
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