The following press releases and media reports about Chinese companies were carried on August 16. To view a full article or story, click on the link next to the headline.
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- Haier Terminates Partnership with 360Buy/Jingdong Mall (English article)
- Tencent (HKEx: 700) Announces Q2, H1 Results (HKEx announcement)
- Sina (Nasdaq: SINA) Reports Q2 Financial Results (PRNewswire)
- Suntech (NYSE: STP) CEO Steps Down, CFO to Take Top Job (English article)
- NetEase (Nasdaq: NTES) Reports Q2 Unaudited Financial Results (PRNewswire)
- Latest calendar for Q2 earnings reports (Earnings calendar)
Troubled solar panel maker Suntech (NYSE: STP) is trying to calm worried investors with news of a victory in a fraud case that could leave it liable for more than $600 million. The only problem is, the company itself may not survive long enough to enjoy the victory, which has come in the courtroom in this fast-evolving case. Suntech shareholders, who bid down the company’s stock to all-time lows after word of the fraud first came out, were largely indifferent to news of the courtroom victory, bidding the stock up a tiny 2 percent to remain near its all-time low.
A new announcement from solar panel maker Canadian Solar (Nasdaq: CSIQ) indicates that Beijing may be preparing to help fund a much-needed consolidation in the oversupplied sector. The news should be welcome by money-losing Chinese solar companies in general, as it indicates that Beijing will continue to provide them with funds to continue their operations as private sector options evaporate. But the move will inevitably raise new complaints from foreign rivals, who will say this funding is exactly the kind of unfair state support that has led to dumping investigations in both the US and European Union.
Solar pioneer Suntech (NYSE: STP) was all smiles earlier this week when it announced an important sales milestone in North America, even as its outlook continued to dim amid a major fraud case that has spawned a new class action lawsuit against the company. (
Instead of lamenting the latest blow to the embattled solar sector that this time is coming from Europe, I’m going to take a different approach today and say that perhaps the ongoing flood of resistance from the west towards Chinese solar subsidies could actually have some positive long-term effects. The reason is this: Beijing, for all its good intentions, has shown it can throw money at developing industries to quickly establish big new manufacturers with major production capabilities. But those fast-rising powerhouses tend to be relatively bad at innovation, with many of the major new advances in the solar sector still coming from the west even as a growing number of players in the US and Europe go bankrupt.
It seems that short sellers aren’t the only ones trying to make some quick money from the confidence crisis plaguing US-listed Chinese stocks, with word that state-owned lender China Development Bank (CDB) is also trying to capitalize on the situation by providing loans to help some companies privatize. If true, the reports would just mark the latest twist in a saga that started more than a year ago when short sellers began to expose a series of accounting scandals at US-listed Chinese firms, sparking a sell-off in their shares. CDB’s move may also auger the start of a bigger wave of privatizations that could see some big US- and Hong Kong-listed companies go private as well.
Shares of solar panel makers took a beating last week, as brokerages downgraded a few amid flare-ups in the trade war between the US and China for an industry already suffering through its worst-ever downturn that has pushed most companies into the red. But while the war of words continues between Washington and Beijing, an even more interesting and potentially devastating low-key war is going on with the solar companies’ shares, which could soon face the very really threat of de-listing from the New York and Nasdaq stock exchanges. JA Solar (Nasdaq: JASO) crossed a quiet but critical threshold on May 18, when its shares closed below the critical $1 mark for the first time, ending that day at 89 cents. Since then they have gone 6 consecutive trading days without rising back above the $1 mark, closing last Friday at 92 cents. Stock market followers will know that rules dictate that US listed companies must maintain their share prices above $1 as a rule to remain listed on the big boards, and that trading below that mark for more than 30 days is grounds for potential delisting. JA Solar, whose market capitalization now stands at $186 million, is the first major player to fall below the $1 mark, but others could soon follow. Suntech (NYSE: STP), which calls itself the market leader even though its market cap is smaller than several of its rivals, saw its shares tumble 8 percent to $1.78 on Friday, near an all-time low, after HSBC reduced its price target for the company. (
The war of words is heating up in the ongoing US-China trade war over unfair subsidy allegations against Chinese solar panel makers, with unusually tough new sounds coming from both sides of the Pacific that indicate the protectionists may be losing some momentum. I’ll admit I was surprised by both of the latest developments, the first of which saw the Chinese solar panel makers finally come together to hold an unusual press conference in Shanghai denouncing planned punitive tariffs announced by the US last week ranging from 30 percent to 250 percent. (
When someone says an industry is in need of consolidation, the assumption is usually that mergers and bankruptcies will reduce overheated competition and excess capacity to create a more efficient and profitable sector. But the concept seems to have a completely different meaning in China, where 2 of the nation’s top solar panel makers discussed the consolidation concept in their latest earnings reports even though we’ve yet to see any major companies close or merge among a money-losing group that now produces more than half the world’s solar cells. In announcing fresh major new losses for their latest reporting quarters, Suntech (NYSE: STP) and Trina Solar (NYSE: TSL) both used the “c” word, with the latter saying specifically it sees further signs of industry consolidation happening. (
