Why JA Solar's Shares Got Crushed

Before you go, we thought you'd like these...
Before you go close icon

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of solar manufacturer JA Solar fell as much as 11% today after the company reported earnings.

So what: Third-quarter revenue was up 11% sequentially to $287.3 million and gross margin improved 3.2% to 11.3% in the quarter. Net loss was $22.6 million, or $1.11 in the quarter. On an adjusted basis, the loss was $14.7 million, or $0.37 per share, a penny worse than expectations.  

Now what: Solar companies have been outperforming expectations all quarter and the industry leaders are now reporting a profit. That's why investors were disappointed in the results, simply because JA Solar is still struggling on the bottom line. I think investors should stick with industry leaders and avoid those taking quarterly losses. In China, the top companies are Canadian Solar and Trina Solar, who are both better bets than JA Solar right now.

A top stock for next year
Looking for a growth stock you can buy now? The Motley Fool's chief investment officer has just hand-picked one such opportunity in our new report: "The Motley Fool's Top Stock for 2014." To find out which stock it is and read our in-depth report, simply click here. It's free!

The article Why JA Solar's Shares Got Crushed originally appeared on Fool.com.

Fool contributor Travis Hoium and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

People are Reading