March 2016

[admin]

One of our bigger holdings, and this looks pretty awesome to us:

• JinkoSolar Holding (NYSE:JKS): Q4 EPS of $2.44 beats by $1.16.
• Revenue of $937.68M (+95.8% Y/Y) beats by $224.91M.

[admin]

From the company PR:

Global demand remains strong, especially in key solar markets, which gives us good visibility for the entire year and leaves us very confident about our future prospects."

JinkoSolar Announces Fourth Quarter and Full Year 2015 Financial Results | Seeking Alpha

We connected 161 MW of solar power projects to the grid during the fourth quarter which brings our total capacity of connected projects to 1,006.6 MW as of December 31, 2015. Aside from the effects of seasonality, power output was impacted by the curtailment of projects in China's western regions and strong rainfall in eastern regions. A number of events beyond our control such as delays in subsidy catalog update and a prolonged grid-connection process made us fall short of our connection target for the year but we are confident in our ability to rapidly make up for this shortfall this year. We are now accelerating the spin-off process to maximize shareholder value."

JinkoSolar Announces Fourth Quarter and Full Year 2015 Financial Results | Seeking Alpha

Global demand for solar energy continues to grow steadily. We remain the market leader in China where growth and demand is expected to be strong and more balanced this year. With the extension of ITC, the biggest market uncertainty has been removed in the US which provides us with good visibility on market stability well into 2018. ASPs in major markets are expected to further stabilize during the first quarter of 2016 as demand grows. We remain cautious about the expansion of production capacity, but with demand growing sharply, we have plans in place to expand our manufacturing capacity to meet our minimum market demand expectations.

JinkoSolar Announces Fourth Quarter and Full Year 2015 Financial Results | Seeking Alpha

[admin]

Gross margin was 19.5% in the fourth quarter of 2015 compared with 21.3% in the third quarter of 2015 and 22.8% in the fourth quarter of 2014. The sequential decrease was from the lower gross margins of electricity revenues due to seasonality and the curtailment of projects in China's western regions.

JinkoSolar Announces Fourth Quarter and Full Year 2015 Financial Results | Seeking Alpha

The Company recorded an exchange gain of RMB72.1 million (US$11.1 million) including change in fair value of forward contracts in the fourth quarter of 2015.

JinkoSolar Announces Fourth Quarter and Full Year 2015 Financial Results | Seeking Alpha

Basic and diluted earnings per share were RMB2.80 (US$0.43) and RMB2.73 (US$0.42), respectively, during the fourth quarter of 2015. This translates into basic and diluted earnings per ADS of RMB11.20 (US$1.72) and RMB10.92 (US$1.68), respectively.

JinkoSolar Announces Fourth Quarter and Full Year 2015 Financial Results | Seeking Alpha

Non-GAAP basic and diluted earnings per share were RMB4.03 (US$0.62) and RMB3.93 (US$0.61), respectively, during the fourth quarter for 2015. This translates into non-GAAP basic and diluted earnings per ADS of RMB16.12 (US$2.48) and RMB15.72 (US$2.44), respectively.

JinkoSolar Announces Fourth Quarter and Full Year 2015 Financial Results | Seeking Alpha

As of December 31, 2015, the Company had RMB4.24 billion (US$654.4 million) in cash and cash equivalents and restricted cash, compared with RMB3.7 billion of cash and cash equivalents and restricted cash as of September 30, 2015. As of December 31, 2015, the total interest-bearing debts were RMB10.29 billion (US$1.59 billion), compared with RMB10.60 billion as of September 30, 2015, of which interest-bearing debts from downstream solar power projects accounted for RMB4.93 billion (US$760.3 million), compared with RMB 4.07 billion as of September 30, 2015.

JinkoSolar Announces Fourth Quarter and Full Year 2015 Financial Results | Seeking Alpha

[admin]

Sort of interesting to know whether this holds, from Zacks:

Stocks ended lower on Monday. But that was not the case mid-day as they were up 0.5%. I want to focus on that early action to make my key point. 

As stocks were moving higher once again, bond and gold investments also went higher. This is an odd contradiction that is worth noting. That is because an ongoing stock advance should be a sign of increased bullishness and optimism. However, continued demand for defensive investments like government bonds and gold says the exact opposite. 

Conclusion: This is a bear market rally and stocks will head lower soon.

Again, let's review the vicious cycle process that we discussed in 2/8/16 Reitmeister Trading Alert commentary: 

"Weaker fundamental data begets weaker sentiment begets lower stock prices begets oversold conditions begets bounce begets pause for reflection.

Often the downward cycle is done here as the pause for reflection has folks truly pondering if continuation of economic expansion and bull cycle is the more likely outcome or do things truly look worse. If the bullish view predominates stocks bounce back until the next new fear arises. However, if the negative view has more traction, then a vicious cycle begins which can keep rolling downhill as follows." 

Right now we are at the pause for reflection stage. The slate of heavyweight economic reports this week should give investors the ammo they need to keep pushing higher for a short spell or time to retest the recent lows. Keep focused on these reports, especially ISM Non-Manufacturing on Thursday as keys to where stocks head next.

[admin]

Well, futures are up, but so are gold and bonds..

[admin]

And yet another $3M insider sale by CEO Anderman of Ellie Mae (ELLI). These sales add up..

[admin]

Well, US bonds are really down a lot (and gold is flat), so things are changing..

[admin]

We're covering our 1000 shares ELLI short at $82.52 for a handy profit..

[admin]

That's a $4230 profit on the ELLI short, we're fairly sure there was more to be get but with short positions we're not overly greedy as they can move against you.

We saw RBS put an overweight on ELLI but a $80 price target, sort of funny.

[admin]

Some good and some bad news out of China. The first is very good, China really needs to deal with its overcapacity and debt accumulation in many state owned heavy industries. But there are still plenty of worrying signs..

The Chinese government will lay off 5 million to 6 million workers over the next few years in an effort to free up cash at massive, indebted companies in the country. Its coal and steel sectors alone will fire 1.8 million people.

Why China is worried about job losses - Business Insider

The outlook for China’s credit ratings was cut to negative by Moody’s Investor Service as reserves decline and government debt rises.

China Credit Outlook Cut to Negative From Stable by Moody's - Bloomberg Business

The risk of a liquidity crisis in China’s bank-run wealth management product (WMP) space, the biggest “deposit” base of China’s shadow bank, is growing at an alarming rate according to Bank of America Merrill Lynch’s February 29 report on the sector.

BofA says China's wealth management products could be systemic - Business Insider

According to figures from the Annual Report of the Bank WMP Industry, the total value of assets in WMP products increased 56% year-on-year during 2015 to a total of 23.5 trillion yuan (USD3.59 trillion). Last year’s growth even exceeded that of 2014 which had already set a high bar. In 2014, the balance of WMPs grew from 10.2 trillion yuan to 15 trillion yuan, up 47.25% year-on-year.

BofA says China's wealth management products could be systemic - Business Insider