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Heard Of Sky Solar? It Could Be Flying Under The Radar

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Heard Of Sky Solar? It Could Be Flying Under The Radar
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In a report issued Friday, Roth Capital analysts Philip Shen and Justin Clare look into Sky Solar Holdings Ltd (ADR) (NASDAQ: SKYS), a micro-cap independent power producer that develops, owns and operates solar parks. After the company reported “inline-ish” second-quarter results, the firm reiterated a Buy rating and $12.00 price target on the stock.

Roth’s Take

The solar energy company delivered second-quarter financial results pretty much in line with estimates (although it missed on the revenue front, and beat in the earnings front), but did not affirm its annual guidance for deployment of 200-220MW in 2015. Nonetheless, the stock is up more than 16 percent on Friday trading.

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The analysts believe Sky Solar may be “close to securing the required capital including project finance to execute on its Japanese and LATAM pipeline.” Thus, the experts think an incremental update in the near term would act as a positive catalyst for the stock.

Lowered Estimates

On the back of the near-term uncertainty of funding and the move of most of Sky Solar’s Latin American projects into 2016, Shen and Clare have lowered their deployment forecast for 2015, from 210MW to 106MW. However, they still envisage 90MW of Japanese deployments.

The analysts also trimmed their revenue forecast to $56 million (down from a prior consensus of $60 million and a previous ROTHe of $65 million), given the lower average connected capacity in 2015. On the other hand, they maintain their gross margin forecast of 66 percent (ROTHe was consensus), but reduce their EPS forecast to $0.14 – down from consensus of $0.26 and prior ROTHe of $0.38.

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Latest Ratings for SKYS

DateFirmActionFromTo
Oct 2017Roth CapitalUpgradesNeutralBuy
Dec 2014NorthlandInitiates Coverage onOutperform
Dec 2014Roth CapitalInitiates Coverage onBuy

View More Analyst Ratings for SKYS
View the Latest Analyst Ratings

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