JinkoSolar Stock Tumbles 14% Despite Improved Results & Growing Global Demand
Shares in JinkoSolar Holding Co. Ltd. (NYSE: JKS) plunged more than 14 percent midday Friday, to $16.84 apiece, after the company posted lower-than-expected revenue and profit for the fourth quarter.
The Shanghai-based maker of solar panels reported in a statement today that its revenue in the three months through December reached $1.1 billion, an increase of 22 percent year-over-year. Net income was $16.7 million, or 44 cents per American depositary share, that's five times the income of the same period of 2017.
JinkoSolar said it has shipped 3,618 megawatts (MW) of solar modules during the fourth quarter, up 46 percent year-over-year.
The chief executive officer of JinkoSolar, Kangping Chen, said that was "another record high" for the company.
"While the Chinese market was impacted by the policies released on May 31st, we were able to continue growing through our diversified global distribution network and further consolidate our leading position in terms of market share," Chen stated.
He also commented on the prospects of the domestic business.
"China's National Energy Administration recently laid out plans for a bidding system and is expected to again begin granting subsidy approvals for utility-scale projects. Most importantly, subsidies will be prepaid by the state grid, which means there will be no more delays in payment for new projects. The new policies set a clear direction for the country's solar plans and will help to greatly improve sentiment for the solar sector as the country tries to smoothly transition towards grid parity and encourage a more market-driven environment. Based on the new policies, we believe domestic installations in 2019 will exceed last year. Distributed generation projects and projects completed at grid parity will continue to make up a larger portion of overall installations."
Chen also noted that JinkoSolar's U.S. manufacturing facility began pilot production in November and is expected to reach full capacity production during the second quarter. He added the demand for solar power in Europe is surging, while the emerging markets in Jordan, Kuwait, South Africa, and Oman are "booming." Lastly, the demand has been "robust" in Southeast Asia as well.
For the full year, JinkoSolar reported revenue of $3.6 billion, a decline of 5 percent from 2017. Net income, however, increased 187 percent to $59.1 million, or $1.52 per share. Its solar module shipments came to 11.4 GW, up 16 percent from 2017.
Chen forecast solar module shipments to grow by approximately 30 percent this year.
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