Roth Affirms Yingli Green Energy (YGE) at 'Sell' as Prelim. Q3 Numbers Miss on Margins, Shipments

Roth Capital affirms its Sell rating and $.31 price target on Yingli Green Energy (NYSE: YGE) after the company's updated Q3 outlook came in shy of expectations.

Analyst Philip Shen noted that the low revenue result ($340 - $350 million, versus consensus at $355 million) came as shipments were weak and margins were thinner than anticipated. The analyst commented: The company has further shifted to OEM production to preserve cash ahead of required debt payments. Due to lower-than-expected facility utilizatioi2015, YGE expects a Q3 impairment charge of $581molong lived assets.

Shen also noted: Discussions with debt-holders appear to be escalating. This will be a key focus on the Q3 call. O11/16, ChinaMoney reported on exchanges between YGE and its debt holders, highlighting some proposals on how to address its debt.

• Proposal 1. YGE is required to pay principal and interest before 12/20/15, including breach of contract fees if going past due date of 12/20/15 (including 0.021% daily penalty).
• Proposal 2. YGE will be using government subsidies for land use to prioritize payments for 10MTN1 note principal and interest (including 0.021% daily penalty).
• Proposal 3. YGE is required to report any progress to debt holders on every Monday including but not limited to expectation of arrival time and amount of government subsidies for land use, government's plan to buy back lands, YGE's operations status for the past week, other debt related matters etc.
• Proposal 4. YGE must specify the government's detailed plans for paying government subsidies for land use, including time, and amount. YGE must notify debt holders within a day after if there is any update from the government.

Proposal 5. YGE must establish daily settlement accounts at Bank of Communications for supervision.

For an analyst ratings summary and ratings history on Yingli Green Energy click here. For more ratings news on Yingli Green Energy click here.

You May Also Be Interested In

• Jefferies Downgrades Calix (CALX) to Hold
• Goldman Sachs Upgrades The TJX Companies (TJX) to Buy, 'best-in-class operator'
• Jefferies Downgrades Enphase Energy (ENPH) to Hold, 'Still Muddling Through'