ReneSola Outlook Dimmer

With a predominantly bearish outlook, we maintain a Hold recommendation for ReneSola Ltd. (SOL - Analyst Report). The company is dogged with pressure on wafer ASPs, rising feedstock costs, and fissures in its Chinese customer base, all of which will adversely affect its performance in the short run.

However, the company divested its stake in its polysilicon joint venture [JV] with Zhongsheng Steel at almost twice its investment and secured additional credit lines to finance its expansion plans. However, in light of a tepid demand scenario, the company is planning to postpone part of its expansion plans.

In the long-run, however, increased captive generation of solar wafer and ingots along with falling polysilicon prices will improve SOL's cost structure and improve earnings. Our 6-month target prive is $2.50 per share.

Read the full analyst report on SOL