Earlier in the week solar giant Energy Conversion Devices reported a 81 percent drop in third-quarter profit due to weak demand for solar power in the United States.
And to make matter worse, the company declined to provide outlook for the fourth quarter, citing poor visibility.
It wasn’t long ago that skyrocketing demand for solar power was a bright spot in the global economy. But a pullback in solar subsidies in Spain and frozen credit markets has recently choked off demand.
On a conference call with analysts, Chief Executive Mark Morelli explained that the company had lower-than-anticipated product sales and higher-than-expected inventory levels at the end of the quarter.
And according to Raymond James analyst Pavel Molchanov "their news adds to the perception that demand is very, very poor."
Sounds bleak. So what should you do? Just when things look their worst is when you might want to strike.
I think Energy Conversion Devices has a great balance sheet, counsels Pete Najarian. I’d take a look.
But if you want to steer clear of the volatility look at IBM . They’re kind of secretly involved in solar.
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