Yingli Green Energy Shares Popped: What You Need to Know

Updated

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 Yingli Green Energy (NYS: YGE) jumped as much as 10% today after the company released earnings.

So what: Revenue jumped 36% to $667.7 million, but gross margins fell to 10.8% from 22.1% in the second quarter as low sales prices weighed on earnings. But on an adjusted basis, earnings per share surprised analysts, reaching $0.14 per share, exceeding the $0.02 loss they had expected.

Now what: There is still a lot of uncertainty for Chinese solar manufacturers considering the vast oversupply in the industry and a European debt crisis hanging over the biggest market. But Yingli is one of the strongest Chinese manufacturers and could emerge a winner when an industry shakeout is complete. That said, I'm not rushing out to buy shares today and would stick with U.S.-based SunPower (NAS: SPWR) , which has higher efficiency panels, similar margins, and a large project backlog to smooth over rough patches in earnings.

Interested in more info on Yingli Green Energy? Add it to your watchlist byclicking here.

At the time thisarticle was published Fool contributor Travis Hoium owns shares of SunPower. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.

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