Although the bull market is now in its eighth year, and the S&P 500 and Dow Jones are still within 5% of their all time highs, some stocks – most notably equities in the solar industry – have missed out on the rebound.
In this article, we take a closer look at five stocks that recently hit 52 week lows this week, incuding Canadian Solar Inc. (NASDAQ:CSIQ), JinkoSolar Holding Co., Ltd. (NYSE:JKS), SunPower Corporation (NASDAQ:SPWR), SolarCity Corp (NASDAQ:SCTY), and Concordia International Corp (NASDAQ:CXRX). In addition, we are going to take a closer look at the smart money sentiment towards these stocks, based on the data from the latest round of 13F filings.
At Insider Monkey, we track around 740 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on, can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see the details here).
Like other solar stocks, Canadian Solar Inc. (NASDAQ:CSIQ) hit a 52-week low this week, falling to $11.72 per share on Friday before rallying briefly. Like the low points of previous cycles, oversupply has been a problem for the industry, and the supply/demand imbalance might take a while before correcting. According to analysts at JMP Securities, the difficult environment could last for another 18 months. Given that time estimate, some buyers are likely waiting on the sidelines until the fundamentals improve or better entry points present themselves. Not many elite funds held shares in Canadian Solar in the second quarter. Of the around 750 funds Insider Monkey tracks, only 16 had a long position in the stock at the end of June, down by one from the end of March.
Although many investors believe JinkoSolar Holding Co., Ltd. (NYSE:JKS) is among the leaders in the solar industry, the stock can’t escape the carnage affecting the entire industry. Due to industry selling and some individual investors giving up, JinkoSolar Holding Co., Ltd. (NYSE:JKS) also touched a 52-week low of $15.18 per share before bouncing slightly. Given the slowing Chinese economy, JinkoSolar’s growth in China might not be as strong as some bulls previously expected. Similarly, due to the soft Shanghai stock market, a potential take-private deal looks very remote/hypothetical right now. Just four funds from our database were long JinkoSolar Holding Co., Ltd. (NYSE:JKS) at the end of June.
On the next page, we examine SunPower Corporation, SolarCity Corp, and Concordia International Corp.