Jefferies Downgrades Trina Solar (TSL) to Hold

Jefferies downgraded Trina Solar (NYSE: TSL) from Buy to Hold with a price target of $10 (down form $21), citing increased margin pressure from aggressive ASP declines.

The firm comments, "TSL is pricing aggressively to win share, and it does not enjoy the higher ASPs to residential rooftop customers (65% of TSL business is large development projects). We believe macro weakness, lack of a meaningful demand pick up, and industry consolidation through attrition will increase TSL’s market share but will erode TSL's earnings power. We lower 2012 GM forecast to 16.2% from 19.8% versus consensus of 18.8%. We decrease our 2012 EPS estimate by 51% to $1.43 from $2.93. We revise down our 2012 revenue expectation to $2.61B from $2.78B. YGE is a close comp, but is able to achieve higher ASPs on its residential customer focus, and higher efficiency Panda modules."

For more ratings news on Trina Solar click here and for the rating history of Trina Solar click here.

Shares of Trina Solar closed at $10.25 yesterday.

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