ReneSola (SOL, Financial) ended fiscal 2014 with a decent performance. The company has been through tough times in the past due to declining revenue. However, the company is pleased with the growing PV market, which is helping the company to re-balance its operations. ReneSola delivered 3.9% growth in revenue as compared to the preceding quarter, and also topped analysts’ estimates by 6.3%. ReneSola is now focusing on various initiatives and strategies that can help it do well.
Trying to get better
ReneSola has struggled in the past due to currency fluctuations. To overcome it, the company is now shifting its focus to the non-Euro markets especially dollar based market as the strengthening of dollar can be a good growth driver for it in future. In addition, ReneSola also succeeded in growing its customer base and with this solid growth in the client pool, ReneSola is expecting it to create new cross-selling opportunities for its products and services.
Further, in the growing PV market, meaningful investments can play a major role in driving its performance in the future. It is now focusing on R&D initiatives and is investing significantly to develop new technologies. This will enhance the efficiency of its current solar projects. Besides, investments, ReneSola is also counting on innovations and bringing in new and competitive products in the market. In the inverter segment, its new 300-watt micro inverter is in trial production and is undergoing onsite project testing. ReneSola is planning to introduce these products in the market soon. This is expected to get good response from key markets in North America and Europe.
Further, ReneSola has also introduced a range of LED bulb products along with LED lighting tubes also featuring a range of configuration and cap design options. These products might be attractive to the customers on the back of its key features. The LED bulb comes with a new composite coating material which is not only cost effective but also is expected to perform outstandingly as compared to other bulbs. These new products by ReneSola in the market are expected to take it to a next level of financial stability in 2015.
With a prudent financial approach along with afterlife strategy, ReneSola is looking to achieve better cash flows and margins. The company has enhanced its cash position in the past and has also reduced its long-term liabilities. The company is striving for future improvement in its financial position with expansion and diversification of its business worldwide.
Conclusion
Now moving to the fundamentals of the stock, the stock doesn’t have a trailing P/E due to a soft performance in the past, but it is recovering slowly and the forward P/E ascertains its decent earnings growth in the near term. Considering these aspects I would like to suggest investors definitely pick ReneSola as of now.
