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Shares of Chinese photovoltaic (PV) manufacturer ReneSola Ltd. (SOL - Analyst Report) surged as much as 19% on Jul 16 on New York Stock Exchange following the company’s increased guidance for the second quarter as well as full year 2013.

The company expects total revenue for the second quarter in the range of $365 million to $375 million, compared with a May forecast of $310 million to $330 million. Shipments are expected in the band of 760 megawatt (MW) to 770 MW, up from the previous expectation of 700 MW to 720 MW. Specifically, the company’s solar module shipments will be in the range of 450 MW to 460 MW versus its earlier projection of 400 MW to 420 MW.

ReneSola − a company that hasn’t seen profits since the second quarter of 2011− expects to report gross margin in the range of 5% to 6%, up from its previous guidance of 3% to 5%.

For 2013, ReneSola expects to ship as much as 2.8 gigawatts (GW) to 3.0 GW of solar wafers and modules, up from its previous prediction of 2.7 GW to 2.9 GW. It expects its solar module shipments to be in the range of 1.6 GW to 1.8 GW versus its previous guided range of 1.4 GW to 1.6 GW.

Although the company failed to register profits for quite a few quarters now, it is gradually expanding its portfolio internationally. ReneSola’s first-quarter loss narrowed from the year-ago quarterly loss due to lower operating expenses and higher solar module shipments.

ReneSola has been busy expanding its international footprint. Its Japanese unit began operations in October last year. The company expects more shipments to Japan in the second half of 2013. Japan would soon turn out to be ReneSola’s third largest market following Europe and the U.S.

Although the company expects to post improved results during the second half of the year, the undesirable impact of countervailing duties of 15.24% and anti-dumping duties of 25.96% levied by the U.S. will pose a headwind to ReneSola’s export business. Europe too has also followed suit and announced its decision to impose tariff duties on solar panels manufactured in China.

However, with the increasing need to develop renewable energy in response to stringent environmental regulations, countries worldwide are relying on solar energy for generating electricity.

The company presently retains a Zacks Rank #3 (Hold). Among the stocks worth considering in the solar space are SunPower Corporation (SPWR - Analyst Report), JinkoSolar Holding Co., Ltd. (JKS - Snapshot Report) and Yingli Green Energy Holding Co. Ltd. (YGE - Snapshot Report). SunPower retains a Zacks Rank #1 (Strong Buy), while JinkoSolar and Yingli retain a Zacks Rank #2 (Buy).

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