Hanwha SolarOne - neuer Name, bessere Zukunkft?

       HANWHA SOLARONE CO LTD's earnings per share declined by 45.9% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, HANWHA SOLARONE CO LTD reported poor results of -$2.97 versus -$1.81 in the prior year.
       The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income has significantly decreased by 46.8% when compared to the same quarter one year ago, falling from -$51.26 million to -$75.22 million.
The debt-to-equity ratio is very high at 2.83 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. To add to this, HSOL has a quick ratio of 0.70, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, HANWHA SOLARONE CO LTD's return on equity significantly trails that of both the industry average and the S&P 500.
The gross profit margin for HANWHA SOLARONE CO LTD is currently extremely low, coming in at 14.84%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, HSOL's net profit margin of -40.55% significantly underperformed when compared to the industry average.

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In the area of guidance, Hanwha offered what normally is not offered by Chinese companies: gross margin of 15 to 20% for a full year. While the market got excited, volume guidance, a 25% increase in the module shipments, spoiled the mood quickly, knowing that the big dogs were heralding 50% increases. Then the company talked about 200MW planned as solar plant strategy. JA Solar made an effort to include the solar plant numbers in the yearly guidance, but I am not sure if Hanwha did. Adding 200MW on the top would suggest around a 58% increase, a substantial utilization of capacity and the second largest increase percentile in modules next to JA.

During January 2014,Hanwha like JA, has shown an increase in module shipment in international markets, a new company record. It was so strong that it became third largest delivery, beating Canadian Solar Inc.(CSIQ). In 2013, the company dedicated most of its sales to global markets, having the highest ASPs among the group. Strong deliveries in January support high Q1 shipments, described as "similar" to Q4 figures, the largest shipment quarter for Hanwha. The volume growth produces speculation that Hanwha is already in capacity expansion mode. This, associated with high ASP driven, among other things, by module retailing in South Korea, puts improvement in revenue scale as a strong possibility.

In the case of Hanwha, the company released plenty of news describing engineering, procurement and construction engagement in China. While the company hinted at a shift in strategy, it failed to provide details during the conference call, perhaps because it was never asked such a question. We know that over 1GW of projects are in their portfolio. A recent one, a distribution generation project planned for rooftops of Wuxi City, includes the intention to keep 100MW for FiT revenue. We can assume plant ownership, and FiT revenue generation is an adding- value mechanism, only when one looks at benefits to JinkoSolar. Both JA and Hanwha have this as future premium, without recognition today.

In my view, both JA and Hanwha are typical undervalued situations that the market failed to upgrade on recent progress. They are candidates for the solar-ready portfolios during 2014, with price per share representing 2011 levels and having plenty of growth coming to them this year. seekingalpha.com/article/...looking-for-undervalued-situations