Are Investors Missing Out On ReneSola Ltd. (ADR) (NYSE: SOL)?


ReneSola Ltd. (ADR) (NYSE: SOL)’s better-than-expected 1Q2016 results were only part of the story for the double-digit percentage spike in the stock. A closer look at the stock reveals that investors scrambled for a pie of the solar company after it guided above expectation for 2Q2016. The other source of excitement in the stock seemed to be the meeting of G7 ministers to lay out details about the Paris climate agreement. ReneSola stands to benefit enormously from the implementation of the Paris climate deal because of its green energy products.

What did ReneSola Ltd. (ADR) (NYSE: SOL) guide for 2Q2016?

ReneSola Ltd. (ADR) (NYSE: SOL) said it was expecting revenue in the band of $280 to $290 million for the current quarter (2Q2016). Even the lower end of the guidance is above the consensus estimate of $275 million in revenue for the quarter.

In addition to the solid 2Q2016, ReneSola also provided encouraging outlook for full-year 2016. It is expecting revenue in the range of $1 billion to $1.2 billion. Analysts on the average are modeling for revenue of $1.13 billion, which is perfectly within the management’s guidance.

What about the Paris climate deal issue?

About 195 countries met in Paris, France to try and find ways to curb global warming. Recent rising global temperatures have alarmed many world leaders and environmental activists. The Paris climate agreement is about rallying nations to slow down the usage of dirty fossil fuels and instead encourage the adoption of cleaner energy such as solar, wind, fuel cell and others. Because of ReneSola’s position in the solar energy business, investors are speculating that the Paris climate agreement bodes well for its future.

What transpired in 1Q2016?

ReneSola Ltd. (ADR) (NYSE: SOL) generated revenue of $260.7 million, down 25.3% YoY, but handily beat the consensus estimate of $256 million. The EPS of $0.06 for 1Q2016 significantly surpassed the consensus estimate of EPS loss of $0.04 for the quarter.


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