That will be the question come baseball season, for sure, but that is a different story. I need to hit the cages a bit more before that can become a reality.
Despite having made a good amount of cash by going long on YGE over the years, this will be my first long YGE coverage on ProofTrader. However, in each of my previous short coverages, I've been very successful.
Yingli is reporting earnings this Wednesday, and while I am not as caught up on recent company events as I used to be, I cannot help but notice the bearish sentiment among the analysts covering the stock. Earnings estimates have slipped, and slipped... and slipped, to the point where you almost have to be a contrarian trader.
When I found this stock many years ago, I was searching for a Chinese solar company with positive earnings and earnings growth. It perfectly described YGE, so I bought it, around the same price it is trading today, and watched it grow to over $12. True, it is not quite the altenergy boom darling it once was, but at this point the analysts are calling for negative earnings, and to me that seems extreme given that Yingli finds a way to make a profit about 75% of the time.
Disclosure: I am long on the March calls. If you give me bargain basement implied volatility on positive earnings for a company that reports positive 75% of the time, I'll take it. You don't even have to go too far out of the money to get a good price. Some say this means the market knows something I don't and it's a sucker bet. I've been a sucker before, but I'll take this bet anyway.