Gold prices near 3-week lows as stronger dollar, trade progress weigh
On Monday, Citi analysts downgraded Jinko Solar Co., Ltd (688223:CH) (NYSE: JKS) from Buy to Sell, halving its price target to RMB5.00 from RMB10.60. The downgrade reflects concerns over the company’s profitability due to increased tariffs in the U.S. market and reduced module prices in China. The stock, currently trading at $17.40, has declined 36% over the past six months, according to InvestingPro data.
Citi’s analysis indicates that Jinko Solar’s gross profit from the American market, which stood at RMB5,880 million in 2024, representing a 61.6% year-over-year growth, is expected to decline in 2025. The profitability downturn is attributed to tariff hikes and competitive price cuts. InvestingPro data shows the company’s gross profit margin has already contracted to 8.39%, supporting these concerns. The firm’s previous Buy rating was based on Jinko Solar’s strong performance in the U.S. market, its leading generation efficiency with TOPCon products, and the potential for earnings recovery due to self-regulatory actions within China’s solar sector.
The report further notes that the module price increase in the first quarter of 2025 appears to be short-lived, as prices have begun to fall amid demand uncertainty following a rush of solar installations leading up to May 31, 2025. Citi has revised Jinko Solar’s earnings forecast, projecting net losses of RMB4,749 million for 2025 and RMB2,059 million for 2026 due to lower average selling prices (ASP).
The revised price target of RMB5.00 is based on a discounted cash flow (DCF) valuation, which has been adjusted down by 53% in light of the anticipated earnings cuts. Citi also finds Jinko Solar’s 2.0x price-to-book ratio (P/B) for 2025 unappealing, given the company’s projected net losses.
In other recent news, JinkoSolar (NYSE:JKS) Holding Co., Ltd. reported a challenging fourth quarter of 2024, with revenue dropping 37% year-over-year to $2.83 billion and a gross margin falling to 3.6% from 15.7% in the previous quarter. The company also posted an earnings per share (EPS) loss of -$9.22, which was significantly below the forecasted -$3.96. Analysts have responded to these results with revisions to their price targets for JinkoSolar. UBS reduced its price target for the company to $22 from $25, maintaining a Neutral rating, while Jefferies lowered its target to $62.01 from $65.43 but upheld a Buy rating.
JinkoSolar’s management has indicated plans to reduce capital expenditures in 2025, focusing on upgrading existing technology rather than expanding production capacity. The company also intends to proceed with a share repurchase program exceeding $200 million, with $120 million already allocated at the U.S. level. These strategic decisions come amid global market pressures, including an oversupply in solar module capacity affecting average selling prices. Additionally, the U.S. Commerce Department’s finalized tariffs on imported solar cells and panels from Southeast Asia may impact JinkoSolar’s market dynamics, with anti-subsidy duties set as high as 3,403.96%.
Despite these challenges, JinkoSolar remains committed to enhancing its N-type cell efficiency to approximately 27% by the end of 2025. The company’s management has expressed confidence in navigating industry cycles, supported by a strong patent portfolio and global manufacturing capabilities. Investors and analysts will closely monitor JinkoSolar’s performance in the coming quarters, especially in light of evolving trade policies and market conditions that could influence the solar industry landscape.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.