One more note on the solar energy piece I wrote about yesterday.
Evidently, the bad news on solar energy has made its way across the country. According to Barclays Capital analyst Vishal Shah early today, two solar energy stocks have seen their ratings cut due to lousy demand for solar energy by U.S. consumers.
Says Shah; “With over 1 GW of inventory in the channel, any demand recovery is unlikely to result in overall industry shipments growth until Q4.”
One stock, Sunpower, saw its price target to $18, down from $35. For First Solar, Shah dropped his price target from $140 per share to $110 per share. Tech Trader Daily tracked the sector’s key players in Tuesday trading and found this (as of 10 AM on Tuesday trading):
- First Solar -- down $12.06, or 9.7%, to $112.80.
- SunPower -- down $2.87, or 12.3%, to $20.44.
- Energy Conversion Devices -- down $4.66, or 25.3%, to $13.77.
- Canadian Solar -- down 48 cents, or 12.2%, to $3.40.
Elsewhere in the technology world, Nokia Corp. says it will layoff 1,700 workers across the globe. The cell phone giant cites terrible demand for mobile phones for the cuts.
"The number of employees we have to reduce is 1,700," Nokia spokeswoman Arja Suominen said. She added that details on who and where the cuts will be made are forthcoming, but didn’t set a timetable.
The markets didn’t take the news well. Nokia shares fell 2.5 percent in Helsinki to euro8.76 ($11.42) after the announcement. Reuters dispatch today on the Nokia layoffs cites company insiders who say that the job cuts are an ongoing manifestation of the economic troubles that the mobile phone company has struggled against in recent months.
“In January, Nokia warned of major cost-cutting measures after its fourth-quarter net profit crashed 70 percent to euro576 million ($744 million),” says Reuters. “It also lost market share, which fell to 37 percent from 38 percent in the previous quarter and 40 percent in the fourth quarter of 2007.”
What is surprising about the Nokia layoffs is that, just last month, the company closed a product research plant and laid off 2,500 Finnish workers – Nokia’s home base. The fact that the company turns around one month later and cuts another 1,700 jobs, and announces that further cuts aren’t out of the question – that can’t be taken a good news for Nokia employees or its investors.
Look for Nokia’s stock to slide even further. It might be time to think about a transformational change in the cell phone sector, and you really have to wonder if, after all is said and done, Nokia will make the final cut.