Trina Solar Shares Plunged: 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: Barely two weeks after a big rally fueled by an analyst upgrade, shares of Trina Solar (NYS: TSL) fell more than 11% when peer First Solar (NAS: FSLR) updated 2011 guidance and offered weak 2012 guidance.

So what: Investors fear that what's bad for one is bad for the other. They may be right. As my Foolish colleague Travis Hoium reported in October, burgeoning efficiency in solar module manufacturing is creating a supply glut, which in turns crimps sales and profits.

Now what: If history holds, we'll have to wait till February to get a fuller report on how Trina is navigating the delicate dance between progress and profits. What do you expect? Would you buy shares of Trina Solar at current prices? Let us know what you think using the comments box below.

Interested in more information about Trina Solar? Add it to your watchlist by clicking here.

At the time thisarticle was published Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He didn't own shares in any of the companies mentioned in this article at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Google+ or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.The Motley Fool owns shares of First Solar. Motley Fool newsletter services have recommended buying shares of First Solar. 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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