Roen Financial Report

4 Key Points to Understand About Solar Energy Companies:

Not All Solar Energy Companies Are The Same

Not all solar energy companies are the same, far from it. There are enormous differences from one company to the next including company size, debt load, technology deployed, efficiency of management, effectiveness of their business plan and the like. Find out about one of the best US based suppliers to the solar industry.

Solar Energy Stocks Can Be Volatile

This is a fickle group of stocks. Over the past 10 years, solar energy companies as a group have had single month moves of over 40% on the upside and downside. Individually, some have as much as doubled in one month, and others have lost half their value on other months. The past 2 years have been especially volatile.

Foreign Companies have Less Stringent Requirements

Of the 15 solar energy companies publically traded on the major US stock exchanges, 8 are based in China. While this is not inherently a problem, investors should be aware that foreign companies as a whole have much less stringent reporting requirements than US companies, so are harder to objectively analyze. In other words, many of the financial statistics of these foreign solar energy companies should be taken with a grain of salt.

Solar Energy Companies Do Not Always Rise With Oil Prices

Common wisdom would have it that as oil prices rise, solar energy companies have better business prospects and also increase in value. Is this true? The answer is yes and no. While the stock price of solar energy companies increased at the beginning of the steep run-up of oil prices that started in January 2007, that connection was lost by the end of the year – solar energy companies fell in price as oil continued to skyrocket. The have, however, become more in synch as oil prices have risen off their bottom earlier this year.