Top 1%
a vote of confidence in WFR
Started May 27 at 11:26 ET (By guliamo)
Although there has been a recent pullback in share value I still maintain that this is a buying opportunity.
Let's take a macro look at this.. a company that producers wafers for sun powered energy, a new market on the move with a P/E of around 20.. that's a P/E we're used to seeing for companies in more established sectors. The reason for this is that WFR is simply a well run company with outstanding financials!
ROE is at 39% - this company has zero debt. Revenues are growing at a nice 14% quarterly rate..
And the greatest news is that this company creates solar wafers from... beach sand that is readily available in Florida... that's why the company shows gross profits of $1 billion on $2 billion in sales. Sounds like a sweet deal to me.
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Top 1%
shlomi
May 27 at 3:59 ET
I still hold that position, although this company is not “bringing home the bacon” yet ... at least not for the share holders.
Top 92%
pilgrimoil
May 28 at 6:15 ET
Does WFR make the wafers from beach sand or do they buy the silicon crystals from Hemlock or other suppliers then cut, polish and contribute other value added services?
Top 1%
guliamo
May 29 at 3:31 ET
Don't hold me to it, but I'm pretty sure they manufacture the wafers from scratch and are top of that food chain.
Without getting too deep into their business, I own WFR because of the macro conditions of the global energy markets. Solar power made perfect sense 20 years ago and is a true necessity these days. There is no infrastructure issue with deploying these power stations and every government of a sunny country now realizes it's cheaper to make your own electricity. WFR are biggest in their field and even at a $20 billion cap, they maintain a solid P/E of 20. WFR is also a US company, so it enjoys a great home consumer market but pays salaries in weak US Dollar while selling aggressively over seas.
With gross profits being 50% of sales, this company can take on lots of competition before the sector fills up and becomes uninteresting.. and baring a general market collapse, I plan to stay in the sector until it does.
Top 92%
pilgrimoil
May 29 at 10:03 ET
Yep, solar is hot. What do you think about XSNX?
Top 1%
guliamo
Jun 01 at 4:44 ET
Well, I don't deal in penny stocks, but it looks like this company is in a product development stage.. too early for me to invest in. Also, I'm looking to cash in on real earnings, not potential. This is why I haven't bought any FSLR, which would be a prime candidate with the way it's growing.. both FSLR and WFR are worth 20 billion. WFR brought home a gross profit of 260 million this quarter, compared to 91 mill from FSLR.. so I'm looking for the company with less hype and more actual juice. You will see this all across my energy position. I hold large caps that are best positioned for sustained profits like CHK, BHP and PTR.
Remember, my friend that with all the enthusiasm, 2008 is and will continue to be a rough year over all. We've all been raking in returns in the 30-40% rate range for the past few years, but I think these days smart money has to go on low well run, low P/E 'here to stay' companies.
Top 3%
ramigabai
Jun 26 at 10:23 ET
Markets look all RED today :-(
I think WFR is a good bet for long term but it looks as they just won't go above 67-68 (I bought at 70) at the short term.
I can't understand why.. their figure are excellent.
I would buy more today if I had more funds. I think they will go up as they just finished building their new plant and stabilized their current plants.
All other competitors are quite full with production capacity so I really think in the long term WFR is heading up.
Top 1%
guliamo
Jun 26 at 10:27 ET
I think you need more patience to realize this growth. WFR is a long term play and I think (and invest accordingly) that this baby is a real gem that will do nicely over the next few years.