In a note out today, Goldman Sachs (
) said it is bullish on the solar sector based on better visibility
for earnings and growth in the near term.
GS outlines its framework for re-rating the sector: namely,
based on MW (MegaWatt) growth, new projects/financing, valuation,
and earnings power. Specifically, the analyst is increasing his
12-month price targets across his entire solar coverage by an
average of approximately 40%.
MEMC Electronic Materials (
) is Goldman's top idea based on sum of the parts analysis and
upside to EPS estimates. The analyst has a Buy recommendation on
the stock and a $10 price target.
GS is upgrading First Solar (
) to Buy (previously Neutral) based on its high quality backlog
(thus, earnings visibility) and reasonable valuation given the
negative sentiment on the stock. The analyst has a $64 price target
Additionally, SunPower Corp (
) is upgraded to Neutral (previously Sell) on the premise that
solar leasing momentum is fairly valued. The analyst's target price
GS acknowledges that longer term risks remain based on an
uncertain pipeline growth and emerging market economics.
WFR 8.04 +0.42 +5.51
FSLR 55.80 +4.04 +7.89
SPWR 20.32 +0.68 +3.46
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