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Evergreen Solar's (ESLR) share price surged 17% on Monday, Oct. 16, after the solar power products maker snared a $100 million contract to supply Mainstream Energy LLC over the next four years.
The development shows how alternative energy has taken off amid soaring oil prices in recent years. Evergreen Solar, of Marlboro, Mass., said it has agreed to ship around $100 million of photovoltaic modules (in other words, solar cells) to Mainstream Energy, which is involved in the sales, distribution and installation of residential and commercial solar electric systems. In the past 12 months, Evergreen Solar has now pulled together six contracts that are collectively worth $700 million.
"Evergreen Solar represents an important strategic partner for us," stated David Katz, President of AEE Solar, a Mainstream Energy subsidiary, in a press release. "We view them as a solar technology pioneer that is making considerable strides in improving cell efficiencies and more importantly, lowering the overall costs of solar power."
Evergreen Solar's plant in Massachusetts will make the solar cells, along with the German factory of EverQ, which is a strategic partnership between Evergreen Solar, Q-Cells AG of Germany and Renewable Energy Corporation ASA (REC) of Norway.
After the news investors bid up the company's shares to $9.60 per share on the Nasdaq. They had traded at a 52 week high of $17.50 per share on March 15.
Cowen analyst Robert Stone reiterated his outperform rating on the stock, explaining that the company's shares have been cheapened lately amid broader industry concerns about prices and market growth. Expressing ongoing confidence in the company's technology for making solar power products, he widened his 30 cents loss per share loss estimate for 2006 to a 31-cent loss, but narrowed his 16 cents 2007 loss estimate to a 7-cent loss, and hiked his 2008 estimate of 2 cents earnings per share to 16 cents EPS.
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