Which technology is going to win the solar contest: traditional PV (SPWR) or thin film PV (FSLR)? It looks like traditional PV is more established, more efficient, more durable, but has a potentially lower tech upside. Thin film is more versatile, doesn’t require silicon, but has some potential env issues due to the toxicity of the materials. More importantly, looking at these companies, I can’t help but be reminded of the computer hardware battle between Dell, Compaq, HP, IBM, etc. These guys were making the boxes, but Intel and Windows swooped in to take all the profits. Who will be in the Intel and Windows of the Solar industry?
It seems like you’ve brought this up before? Dell, Compaq, HP & IBM all made plenty of money. All the companies you mentioned traded at reasonable earnings’ multiples (at one point in time)… something the solar companies have not yet done.
Why not buy AMAT? Those guys are shareholder friendly and it’s not crazy expensive. It just seems like a no-brainer if you must have a solar stock.
Nah, that wasn’t me, but I see the post you’re referring to. It looks like the solar side only makes up about 10% of AMAT’s revenues. And their thin film uses a different base material than FSLR. Good idea though, I’ll keep looking into it.
Solar? You damn kids should have to read this article at least one annually, until you have it memorized: http://money.cnn.com/magazines/fortune/fortune_archive/1999/11/22/269071/index.htm
Yeah, that’s a good article. I’m much more of a value guy, and would prefer to recommend a safer stock. Thus, an established company with a decent solar segment (like AMAT or Sharp) might be a good option. That said, I also like STP as well. They’re getting into thin film, they have a big presence in a rapidly growing market (China), and they have a relatively reasonable valuation (thanks to a whopping 50% drop in 2008!).
You’re right Nakedputs… that’s why I put in the CAVEAT of “if you must have a solar stock”. Today, I bought a cement stock. Not sexy at all but it’s insanely cheap and growing fast.
FSLR 18.5B market cap for Revenues of only 500M - don’t see any value in there. Even if the thin film technology wins in the end, that has all been factored into the price.