Investor love-in with solar continues
Suntech Power, the first Chinese solar play in the United States, saw its stock soar more than 40 per cent on its first day of trading on the New York Stock Exchange — yet another strong sign of high investor interest in solar technology companies. Checked the share price today and it’s holding up: was about $20.85 (U.S.) at noon, compared to its offering price of $15.
Suntech’s IPO raised nearly $400 million for a company expected to have between $30 million to $35 million in profits this year.
SunPower Corp., which had its IPO in November, is still trading nearly 60 per cent above its offering price. Other major solar IPOs include Q-Cells and Conergy, two German solar manufacturers that went public in October and experienced similar success.
Rhone Resch, president of the Washington, D.C.-based Solar Energy Industries Association, told Red Herring that SunTech’s IPO is “consistent with the trend we’ve seen from investors that solar is a smart investment right now.”
Considering the valuations being given to these companies, it makes me wonder about the potential in Canadian plays, such as Carmanah Technologies, which has broadened its entry into the solar market with its purchase earlier of Soltek and remains profitable.
Tyler Hamilton is editor-in-chief of Corporate Knights magazine and a business columnist for the Toronto Star, Canada's largest daily newspaper. In addition to this Clean Break blog, Tyler writes a weekly column of the same name that discusses trends, happenings and innovators in the clean technology and green energy market. This blog is a personal project started in April 2005. It is not an official blog of the newspaper.
December 15th, 2005 at 3:41 pm
I agree 100% about the potential gains an investor may receive from Carmanah. I think the biggest investor hurdle (for US based investors) is that the stock is not liquidly traded on a US exchange. They are currently a pink sheet company with no volume and many investors will shy away from it. When I talked with them recently they have no plans to try and move to a larger exchange. You can still buy the stock, it is just more difficult for US investors.
Maybe you can use your contacts with them to help change their mind. I would love to be able to own this company.
December 15th, 2005 at 3:46 pm
I know this doesn’t count as a U.S. exchange, but they’re in the process of being listed on the Toronto Stock Exchange, which is among the larger exchanges in North America. Better than the TSX-Venture exchange from that perspective, but I understand what you’re saying.