Auriga Starts Suntech Power (STP) at Sell

Auriga initiates coverage on Suntech Power (NYSE: STP) with a Sell. PT $1.00.

The firm states, "Suntech Power is the largest crystalline silicon (c-Si) solar module manufacturer based in China that is increasingly moving towards vertical integration from ingots, wafers, cells to solar PV modules. We believe the company's business model cannot cope with operational challenges of intense ASP pressure, high cost structure, capital structure challenges from high and rising debt level (debt/capital ~60%) drag on earnings, and continued losses for the next several quarters without a major reorganization . In view of a broken business model, and pending a major reorganization to bring about structural/operational clarity, we rate the stock a Sell with a nominal $1 price target."

For more ratings news on Suntech Power click here and for the rating history of Suntech Power click here.

Shares of Suntech Power closed at $4.10 yesterday.

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