Suntech Pluto Tech Unmatched

Suntech Power Holdings Co.’s (STP - Analyst Report) Pluto cell technology has made a world record by reaching a 20.3% efficiency level, up from the 19.6% best cell efficiency of the first generation Pluto cell technology. The feat was achieved by using standard commercial-grade p-type silicon wafers.

Suntech Power is the world's largest producer of solar panels and its Pluto cell technology is one of the leading technologies in the industry. In collaboration with the University of New South Wales, Suntech's research and technology development (R&D) team has spearheaded this effort.

The company has been able to improve upon the 19.6% level by efficiently utilizing PERL cell technology in the conventional Pluto cell manufacturing process. By reducing the metal/silicon interface area, the PERL technology improves the rear surface design of a conventional Pluto cell.

Also, the company has introduced process changes that lessen the use of high temperatures enabling the application of high efficiency processes to the most commonly used commercial wafers. With more and more optimization, the company expects the efficiency of the improved Pluto cell technology to reach 21.0% in the next 6 to 12 months.

In another feather to the cap, the company along with a team of researchers from Swinburne University of Technology developed the world's most efficient broadband nanoplasmonic solar cells in February 2012. Suntech is well known for its advanced cell and module technology developments in leading solar technology innovation. Therefore, the company plans to maintain and extend this collaboration through Suntech R&D Australia Pty Ltd, which was established in 2011, as it focuses on manufacturing implementation of advanced cell technologies.

The company is prudently expanding its revenue base to divergent markets around the globe, along with increasing megawatts shipped. Positive factors include ongoing expansion programs, higher conversion efficiency through its Pluto technology-enabled modules, and improving operating efficiencies.

Also, the increasing efficiency level in Pluto cell technology highlights the company’s focus and investment in R&D that delivers the best solar technology to its customers at an affordable price. We believe that in the current weak environment, where most of the solar companies are incurring losses, this achievement would be fruitful for the company.

In spite of it all the positives are overshadowed by fears of tepid module demand in Europe, rising competition, the volatile euro and the financial stability of its customers. Moreover, the company recently posted fourth quarter 2011 adjusted loss of 76 cents per American Depository Share (ADS), far wider than the Zacks Consensus Estimate of a loss of 32 cents. The results were a stark contrast to the year-ago adjusted earnings of 32 cents per share.

The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock.

Based in Wuxi, China, Suntech Power Holdings Company Ltd. is a solar energy company that designs, develops, manufactures and markets a variety of photovoltaic cells and modules, including a broad range of value-added building-integrated photovoltaic products. The company mainly competes with SunPower Corporation (SPWR - Analyst Report) and Canadian Solar Inc. (CSIQ - Analyst Report).