Make Solar Panel Components While the Sun Shines?

It’s an ill wind that makes you think “perhaps I should get solar before the government tariff ends”. Actually the tariff isn’t the main consideration, unless you’re likely to export 100% of your generated electricity (and perhaps not even then). It’s having a system where you need the power you generate that nets you more in the end, according to my research.

That said lots of people are planning to install solar panels before the end of the year to take advantage of the government tariff expiring at the end of the year. Knowing that there is now, for some installers at least, a shortage of stock moving towards December, it’s likely there’ll be some windfall profits for solar panel and component manufacturers. We often find the best results by investing in the peripheral businesses, not the retail end of a supply chain.

So I went looking for UK based solar panel component manufacturers. There aren’t many of them as you may imagine. What is shocking is that they are performing terribly! You’d expect it to be a massive growth industry but instead the price charts shout “move along, please; nothing to see here”.

The PV Crystolax Solar plc (PVCS) chart needs no explanation. They’re obviously doing something very wrong. Perhaps they’re worth an entirely speculative punt. They have a lot of their business in China, it seems, and are blaming over-supply there for poor results. That may be so, but if they pick up a deal of last minute business, and do the sensible thing and charge through the nose for fast delivery, then they could at least see a price blip. I certainly won’t be looking at what is nothing more than a bet on this one. If I did though I’d buy with an amount I’m prepared to lose completely and immediately place a limit order in case there’s a price spike, and thus take advantage of it. Theres’ a huge bid/offer spread with prices at 8.03p to sell and 9.25p to buy. That’ll be larger on a spread bet.

The only other one I can find listed here is in fact a German company with an LSE Europe listing. Phoenix Solar AG (OFPQ). They’re certainly not exposed enough to the UK to make a play worthwhile on this December tariff play. They too have been disappointing of late, with earnings coming in below forecasts in September this year. Yikes.

If you want to make money out this solar thing my suggestion is to wait until next year and negotiate hard for a huge discount until you find a solar supplier/installer who is vulnerable and needs the work and take advantage. You’ll end up with more money in your bank at the end of the day by doing that, I’d guess!

Sometimes a great idea doesn’t pan out. But this is how you get into interesting trades. Many years back, spotting two new coffee shops in my London suburb led to a great trade for a very small amount of work. Research, even for technical traders, is a key to success.