Solar power stocks drop as orders are cancelled

Solar power stocks drop as orders are cancelled

World solar panel manufacturers are suffering due to falling orders

Q-Cells SE, the world's largest manufacturer of solar cells according to the Times of London severely cut back its earning estimate this week, causing a drop in its own stock and that of other solar companies. Late Monday afternoon, the German company's stocks were trading at 28.17; Tuesday morning, they were down to 20.6. (Click here for up-to-date value.)

The drops were the result of what CEO Anton Milner described as a "flood" of canceled and delayed orders.

Not surprisingly, other solar companies with connections to Q-Cell also suffered, such as the LDK Solar Company and Solarfun Power Holdings, although Solarfun appeared to be rebounding on Wednesday. But so did other solar companies not directly connected to Q-Cell, such as Suntech Power Holdings and First Solar|FSLR - First Solar.

Ethan Zimbler, Head of North American research for the New Energy Finance, sees this as a general trend, and not a worrisome one in the long run . A shortage of polysilicon has the cost of manufacturing solar cells high, but "That bottleneck is about to bust wide open. The prices on solar modules will come down quite a bit. That's a good thing for the world. On the other hand, if you're a shareholder, declining prices and a declining market is what you don't want to see."

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