STR Holdings (STRI) Beats, Guides Above Street, Doubles Malaysia Capacity

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07:51:04 pm on May 11, 2010

STR Holdings (STRI) continues to impress following its debut last year.  It’s been one of the most steady IPO’s, nearly doubling in price since last November as it follows an up trend along the 50 day moving average.  The fundamentals weren’t all that impressive while the stock was running up, but now we know why.  The technicals always lead the fundamentals and the company just reported strong growth after the bell today and is guiding above the Street for next quarter and the full year.

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They reported an EPS of .31/share which is .06/share above analyst expectations and 138% over the year ago quarter. Revenues were about in line at $80 mill and represents a 37% increase over the year ago quarter.  The company is on pace for a record year this year and expects to follow that with another record year in 2011.  They see Q2 EPS in the range of .33 – .36/share vs the analyst estimate of .32/share and full year EPS in the range of $1.12 – $1.20  vs the analyst estimate of $1.09.  An all around very impressive quarter with great guidance.  The trend should continue along that 50 day moving average just fine as long as the overall market doesn’t fall off a cliff again.

The company attributed its success to strength in its solar segment which grew revenues 60% over year ago quarter, fueled by growth in Asia.  Due to demand, they plan to double the production and warehouse space in Malaysia. CEO Dennis Jilot commented:

“We are pleased that Solar’s global sales volume increased 22% on a quarterly sequential basis. Additionally, during the first quarter of 2010, our Solar business continued to execute our ‘One-Plus-China’ strategy as net sales into Asia increased approximately 72% quarter over quarter and 31% on a sequential quarterly basis. In light of anticipated growth in our Solar business, we have initiated an expansion that will double the size of the production and warehouse space in Malaysia providing floor space for total capacity of up to 4.0 GW. We expect this project to be completed by the end of the first quarter of 2011.”

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