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JA Solar Holdings (JASO) Q1 Earnings: What's in the Cards?
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Solar company JA Solar Holdings Company Ltd. is set to release first-quarter 2016 results before the opening bell on May 27, 2016. In the preceding quarter, the company had delivered a negative 5.66% earnings surprise. Let’s see how things are shaping up prior to this announcement.
JA Solar caters to a geographically diversified pan-continental customer base, spanning over Germany, Italy, the U.S., Spain, India, Korea, China and Japan. The company’s focus on widening its geographical customer base has resulted in incremental international sales. It is particularly focused on expanding its market share in the emerging markets, particularly in India and Americas.
The company expects to ship 1.0–1.1 gigawatts (“GW”) of cells and modules in the first quarter of 2016. The company anticipates module shipment of about 100 MW to its downstream projects. It expects demand to remain robust in China in the first half of 2016.
The company had earlier said that gross margin may be hurt during the first quarter due to the absorption of wafer price increases. The company is of the opinion that upstream material suppliers are struggling to keep up with the industry’s robust growth and are exploiting their pricing power.
Also, anti-dumping policies in the U.S. and Europe apart, JA Solar has to face cut-throat competition from its domestic peers. The fierce competition between Chinese solar companies sometimes leaves them with a feeble margin.
Earnings Whispers
Our proven model does not conclusively show that JA Solar is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here.
Zacks ESP: JA Solar has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 22 cents.
Zacks Rank: JA Solar carries a Zacks Rank #3, which when combined with a 0.00% ESP, makes a surprise prediction uncertain this season.
We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Peer Releases
SunPower Corp. (SPWR - Free Report) reported first-quarter 2016 adjusted loss of 42 cents per share, wider than the Zacks Consensus Estimate of a loss of 23 cents by 82.6%. In the year-ago quarter, the company had reported earnings of 5 cents per share.
First Solar Inc. (FSLR - Free Report) reported first-quarter 2016 earnings of $1.66 a share, sweeping past the Zacks Consensus Estimate of 91 cents by 82.4%. The reported number was also a reversal from the prior-year loss of 61 cents, reflecting higher sales, gross profits, operating income and lower expenses.
SolarCity Corp. posted an adjusted loss of $2.56 per share, much wider than the Zacks Consensus Estimate of a loss of $2.30 and the year-ago loss of $1.52 per share. The wider loss can be attributed to the company’s rising expenses.
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JA Solar Holdings (JASO) Q1 Earnings: What's in the Cards?
Solar company JA Solar Holdings Company Ltd. is set to release first-quarter 2016 results before the opening bell on May 27, 2016. In the preceding quarter, the company had delivered a negative 5.66% earnings surprise. Let’s see how things are shaping up prior to this announcement.
JA SOLAR HOLDGS Price, Consensus and EPS Surprise
JA SOLAR HOLDGS Price, Consensus and EPS Surprise | JA SOLAR HOLDGS Quote
Factors at Play
JA Solar caters to a geographically diversified pan-continental customer base, spanning over Germany, Italy, the U.S., Spain, India, Korea, China and Japan. The company’s focus on widening its geographical customer base has resulted in incremental international sales. It is particularly focused on expanding its market share in the emerging markets, particularly in India and Americas.
The company expects to ship 1.0–1.1 gigawatts (“GW”) of cells and modules in the first quarter of 2016. The company anticipates module shipment of about 100 MW to its downstream projects. It expects demand to remain robust in China in the first half of 2016.
The company had earlier said that gross margin may be hurt during the first quarter due to the absorption of wafer price increases. The company is of the opinion that upstream material suppliers are struggling to keep up with the industry’s robust growth and are exploiting their pricing power.
Also, anti-dumping policies in the U.S. and Europe apart, JA Solar has to face cut-throat competition from its domestic peers. The fierce competition between Chinese solar companies sometimes leaves them with a feeble margin.
Earnings Whispers
Our proven model does not conclusively show that JA Solar is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here.
Zacks ESP: JA Solar has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 22 cents.
Zacks Rank: JA Solar carries a Zacks Rank #3, which when combined with a 0.00% ESP, makes a surprise prediction uncertain this season.
We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Peer Releases
SunPower Corp. (SPWR - Free Report) reported first-quarter 2016 adjusted loss of 42 cents per share, wider than the Zacks Consensus Estimate of a loss of 23 cents by 82.6%. In the year-ago quarter, the company had reported earnings of 5 cents per share.
First Solar Inc. (FSLR - Free Report) reported first-quarter 2016 earnings of $1.66 a share, sweeping past the Zacks Consensus Estimate of 91 cents by 82.4%. The reported number was also a reversal from the prior-year loss of 61 cents, reflecting higher sales, gross profits, operating income and lower expenses.
SolarCity Corp. posted an adjusted loss of $2.56 per share, much wider than the Zacks Consensus Estimate of a loss of $2.30 and the year-ago loss of $1.52 per share. The wider loss can be attributed to the company’s rising expenses.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>