Hapoalim Securities Lowering EPS Estimates On Suntech Power (STP)

Hapoalim Securities is reiterating its Sell rating and $6 price target on share of Suntech Power Holdings Co., Ltd.

after the solar power company came out with a negative pre-announcement yesterday. In the report to investors, Hapoalim Securities writes, "Following STP’s pre-announcement on August 6, 2010, we are lowering our EPS estimate for 2Q10. With our revenue forecast edging up and our GM forecast inching down, we raise our operating income forecast by $5m. However, due to a larger-than-expected FX loss and write-downs of ~$170m, our EPS estimate falls to ($0.88), or $0.05 (x-1x items). Of larger concern, however, is the write-down of its investment and prepayments with Shunda. Though we don’t believe this will impact STP’s wafer supply near-term, this underscores its vulnerability of not having wafering in-house." Shares of Suntech Power are getting hit hard today, down 53 cents to $9.51.