Riding the Roller Coaster

By Jennifer Kho, Greentech Media

Stocks are rising again after a steep drop Wednesday, when the S&P 500 dropped 9 percent, the Nasdaq Composite Index fell 8.5 percent and the Dow Jones Industrial Average declined 7.9 percent.

The roller coaster ride – the plunge of last week followed by a jump Monday, a fall again Wednesday and a rise again in recent trading today – has put the economy at the forefront of many of the conversations at Solar Power International.

After all, solar shares certainly haven’t been immune from the turbulence. So far today, SunPower (NSDQ: SPWRA) has grown 11.3 percent to $45.65 per share after falling 17.7 percent yesterday, First Solar (NSDQ: FSLR) has increased 6.7 percent to $132.45 per share after dropping 13.69 percent yesterday and Suntech Power (NYSE: STP) is up 6.5 percent to $22.23 per share after a decline of 16.6 percent yesterday.

And solar – as well as the energy industry as a whole – is capital intensive.

As Greentech Media senior analyst Eric Wesoff puts it, “Unlike building browsers, companies have to actually build these damn things.”

That could keep some companies from getting off the ground as soon as they’d like.

“Debt financing is nonnegotiable,” said Nathaniel Bullard, a senior analyst at New Energy Finance. “If you need it and can’t get it, you can’t build.”

Meanwhile, Julie Hamm, executive director of the Solar Electric Power Association, said that solar is more prepared to deal with fluctuating markets because of its long history of dealing with “start stop” government policies.

The solar industry’s “been on the roller coaster ride its whole existence,” she said.

If you’d like to read more about this issue, check out a Greentech Media story I wrote called Solar Industry Talks Economy.

Tags: solar shares economy stock stocks market nasdaq dow s&p bullard wesoff hamm sepa kho greentech media

This entry was posted on Thursday, October 16th, 2008 at 2:09 pm and is filed under PV manufacturing, Solar Power International. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.