Monday, September 24, 2007

Of Green Investing... And Wall Street Analysts Being Right but Early

Okay, so CIBC analyst Adam Hinckley says his firm is downgrading LDK to "sector perform" because its rapid deployment of a polysilicon plant next to its solar-water plant indicates that producing polysilicon is so easy, anyone can do it. Hmm. I guess they should have taken longer to get the plant up and running.

To be fair, we should pay attention to this analyst's take, because CIBC was in fact the first Wall Street firm to initiate coverage on LDK back in July. While we don't buy and sell based on analyst rankings, they're interesting fodder.

Meanwhile, Piper Jaffray, UBS and Needham have all initiated their own coverege this month, and all of them rate LDK as a "buy" and a "sector outperform." So this could be a case of Hinckley being right... but being WAY early, as in about six months to a year early.

LDK's doing a lot of business on the silicon front already, which can only be a bullish sign. The other thing is, putting up a silicon plant is no easier or harder to do today than it was six months ago, so the timing of CIBC's downgrade is interesting to say the least.

Only time will tell. Till then, mind your stops.


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