Earnings Release: MEMC
An amazing quarter! The highlights:
* Net income grew YoY to $376.4 million, or $1.72 per share, from $129 million, or $0.56 cents per share. Excluding a one-time gain of $0.75, the earnings were $0.97 EPS. Analysts expected $0.96.
* Revenue grew 27% to $535.9M from $420.6M last year. Analysts expected $544M. The $8M sales gap was due to a shut down at one of the production plants.
* Gross margins increased to 54.8% from 48.3% last year
* PE of 22 (excluding the $0.75 one time event) with a forecasted growth of ~30%.
* Raised revenue and earnings guidance by $5M and $0.40~$0.50 (a 10%+ increase). that excludes any future gain on the Suntech warrants
WHY YOU SHOULD BUY MORE
* Demand for wafers exceeds supply - While I think solar power demand will slacken in a recession, there is no denying that solar will remain in hot demand. Chip demand continues to grow as well.
* Margins accelerating
* Production expanding to meet more demand
* Limited competition for high volume, higher margin 200mm wafers
* Suntech warrants - WFR has ~8M warrants priced at ~$28. They can exercise 20% per year and they have been cashing out each quarter. STP was recently trading in the 80s and is now in the 50s. This is an earnings kicker of at least $50M per year.
* Net income grew YoY to $376.4 million, or $1.72 per share, from $129 million, or $0.56 cents per share. Excluding a one-time gain of $0.75, the earnings were $0.97 EPS. Analysts expected $0.96.
* Revenue grew 27% to $535.9M from $420.6M last year. Analysts expected $544M. The $8M sales gap was due to a shut down at one of the production plants.
* Gross margins increased to 54.8% from 48.3% last year
* PE of 22 (excluding the $0.75 one time event) with a forecasted growth of ~30%.
* Raised revenue and earnings guidance by $5M and $0.40~$0.50 (a 10%+ increase). that excludes any future gain on the Suntech warrants
WHY YOU SHOULD BUY MORE
* Demand for wafers exceeds supply - While I think solar power demand will slacken in a recession, there is no denying that solar will remain in hot demand. Chip demand continues to grow as well.
* Margins accelerating
* Production expanding to meet more demand
* Limited competition for high volume, higher margin 200mm wafers
* Suntech warrants - WFR has ~8M warrants priced at ~$28. They can exercise 20% per year and they have been cashing out each quarter. STP was recently trading in the 80s and is now in the 50s. This is an earnings kicker of at least $50M per year.
posted by Andrew at
8:51 PM
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