Shedding Light on Solar

The best place to look for multi-bagger stock ideas is often in cyclical industries that are flat on their backs, completely out of favor. So horrific that even the deepest-value managers hold their noses to buy the stocks. So bad that investors think the stocks will never come back. So awful that the stocks are down 90% or more off their highs. You get the idea.

One such ugly sector is solar, which was clocked by a confluence of factors that have destroyed sales and margins. The group experienced rapid growth over the past few years as government incentives, mostly in Europe, drove rapid growth of installations. The Germans were so aggressive about subsidies that solar now generates 26% of domestic electricity -- and it's not even a "sun" country. Italy and Spain were also aggressive about Feed-in Tariffs (FiTs) that subsidized solar energy. Companies such as First Solar (FSLR) blossomed. Its stock appreciated to $150 from $27 last year on exceptionally strong sales and earnings growth....426 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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