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Solar Stocks Break Away from Rest of Energy Sector, Move Higher Despite Bearish Sentiment

September 23, 2011 12:47 PM EDT
TAN Hot Sheet
Rating Summary:
    0 Buy, 0 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 16 | Down: 7 | New: 23
Solar stocks have bounced nicely Friday, bucking the downtrend in the broader Energy sector.

As measured by the Claymore/MAC Global Solar ETF (NYSE: TAN), the group is now up more than 3 percent after a gap down at the open this morning. The fund is down 35 percent since the beginning of September.

Over the same time period, the Energy Select Sector SPDR ETF (NYSE: XLE) is down more than 13 percent.

The move higher in solar stocks looks even stronger considering a bearish note from Mizuho's Paul Clegg Friday morning.

While the analyst is still bullish on First Solar (Nasdaq: FSLR) and SunPower (Nasdaq: SPWRA), Clegg argues second-half and 2012 estimates within the Solar sector are too high given average selling prices which have continued to decline. The analyst believes "most solar companies" will lose money next year.

Clegg downgraded shares of Trina Solar (NYSE: TSL) from Buy to Neutral and shares of Suntech (NYSE: STP) from Neutral to Underperform earlier.


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