Suntech Power, the first Chinese solar play in the United States, saw its stock soar more than 40 per cent on its first day of trading on the New York Stock Exchange — yet another strong sign of high investor interest in solar technology companies. Checked the share price today and it’s holding up: was about $20.85 (U.S.) at noon, compared to its offering price of $15.
Suntech’s IPO raised nearly $400 million for a company expected to have between $30 million to $35 million in profits this year.
SunPower Corp., which had its IPO in November, is still trading nearly 60 per cent above its offering price. Other major solar IPOs include Q-Cells and Conergy, two German solar manufacturers that went public in October and experienced similar success.
Rhone Resch, president of the Washington, D.C.-based Solar Energy Industries Association, told Red Herring that SunTech’s IPO is “consistent with the trend we’ve seen from investors that solar is a smart investment right now.”
Considering the valuations being given to these companies, it makes me wonder about the potential in Canadian plays, such as Carmanah Technologies, which has broadened its entry into the solar market with its purchase earlier of Soltek and remains profitable.