GT Solar International, Inc. (SOLR) - Zacks #1 Rank Top Performers

There wasn't much of a contest in the Zacks #1 Rank List today, as GT Solar International, Inc. (SOLR) soared far and beyond all other companies to become the Top Performer.

Shares advanced practically 15% on Wednesday; it was the only company on the list in double digits. Volume was just as ebullient with nearly 7.6 million shares moving, compared to the daily average of around 3.8 million.

The performance heralded GT Solar International's entry into the LED equipment market, as the company announced its first 2 orders for sapphire crystallization systems.

Meanwhile, it was a good day for good news, as the market soared with the Dow gaining approximately 2.3% (or nearly 250 points) and the S&P 500 advancing around 1.6% (or about 19.5 points). Also, the NASDAQ improved by a little more than 2% (or 51.2 points).

Earnings estimates for GT Solar International have moved sharply higher in the past 30 days, but we can't credit the orders or today's strong market. The catalyst for these upward revisions was SOLR's strong fiscal second quarter report from Nov 5, which included year-over-year gains in EPS and revenue, along with an upgraded guidance for the full year.

GT Solar International is a global provider of polysilicon production technology, and sapphire and silicon crystalline growth systems and materials for the solar, LED and other specialty markets. According to the company, its products and services allow customers to optimize their manufacturing environments and lower their cost of ownership.

This Zacks #1 Rank ('strong buy') company has a longer-term "Neutral" recommendation. It is 1 of only 2 companies from the elec-manufacturing machinery industry on today's Zacks #1 Rank List. The other company is Cohu, Inc. (COHU).

Here Comes SOLR

GT Solar International let everyone know that its sights were set on the LED equipment market when it acquired Crystal Systems back in July. Now the company has its first 2 orders for sapphire crystallization systems, and this is expected to be just the tip of the iceberg.

The orders came from Jiangsu Jixing New Material Company, Ltd. and Jiujiang Sapphire Tech Company, Ltd., and are valued at more than $84 million. These orders bring SOLR's quarter-to-date bookings to more than $245 million.

The company said it continues to talk with other potential customers in the Asia region and believes it is on track to meet its projected $100 million in revenue for its fiscal year 2012 from sapphire crystallization equipment sales.

Earnings Estimates for GT Solar International

During its fiscal second quarter report, GT Solar International raised its earnings per share for its fiscal 2011 to between $1 and $1.10, compared to the previous outlook of 90 cents to $1. At the time of this announcement, we were expecting 92 cents.

Analysts were decisive in their reaction as all 10 estimates were revised higher. The Zacks Consensus Estimate for the year ending March 2011 is now $1.11 per share, which is up 21% in the past 30 days.

It's the same story for the fiscal year ending March 2012 as all 10 estimates were enhanced. The Zacks Consensus Estimate is now $1.18 per share, or 35.6% better than a month ago. (There has also been a single downward revision in the past 7 days for next fiscal year.)

Another Positive Surprise

Almost a month ago now, GT Solar International reported earnings of 28 cents per share for its fiscal second quarter, which substantially exceeded last year's 6 cents. The result also surpassed the Zacks Consensus Estimate by about 16.7%.

As the chart below shows, SOLR has now beaten expectations for 4 consecutive quarters, and has done so in the double and triple digits.

Revenue jumped 120% year over year to $229.3 million from $104.2 million.

In addition to its enhanced guidance for EPS, GT Solar International also raised its revenue outlook for fiscal 2011. The company now expects between $775 million and $850 million, instead of the earlier guidance of $700 million to $775 million.

 
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