Yet JP Morgan cautions investors should avoid First Solar in 2013. “We see the issues currently plaguing the Solar PV industry—significant overcapacity and declining demand in Europe, which historically has been the largest market—continuing in 2013,” said JP Morgan analyst Christopher Blansett, according to a Business Insider report. “Unless there is a significant increase in North American natural gas pricing, which seems unlikely given continued productivity improvements of shale-based wells, solar PV stocks are likely to remain out of favor with investors in 2013.”
The two solar ETFs have been lackluster performers in 2012 with losses of more than 35% heading into Wednesday’s rally.
The sector’s boost Wednesday was also driven by a 21% ramp in shares of LDK Solar (NYSE: LDK). The company said it has “entered into discussions with certain creditors to obtain additional flexibility with respect to the terms and conditions of our existing offshore indebtedness.” The firm has engaged Citigroup to assist it in the process.
Guggenheim Solar ETF
