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5-Star Stocks Poised to Pop: MEMC

Sat, 07/24/2010 - 12:32 by Brian D. Pacampara

Based on the aggregated intelligence of 140,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, silicon-wafer maker MEMC Electronic Materials (NYSE: WFR) has earned a coveted five-star ranking.

 

With that in mind, let's take a closer look at MEMC's business and see what CAPS investors are saying about the stock right now.

MEMC facts

Headquarters (Founded)

St. Peters, Miss. (1984)

Market Cap

$2.8 billion

Industry

Semiconductor equipment

Trailing-12-Month Revenue

$1.23 billion

Management

CEO Ahmad Chatila (since March 2009)
CFO Kenneth Hannah (since April 2006)

Return on Equity (Average, Past 3 Years)

30.6%

Cash / Debt

$792.2 million / $28.9 million

Competitors

ReneSola (NYSE: SOL) 
LDK Solar (NYSE: LDK) 
SunPower (Nasdaq: SPWRA)

CAPS Members Bullish on WFR Also Bullish on

General Electric (NYSE: GE) 
Apple (Nasdaq: AAPL)

CAPS Members Bearish on WFR Also Bearish on

Elan (NYSE: ELN)

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 97% of the 1,918 members who have rated MEMC believe the stock will outperform the S&P 500 going forward. These bulls include robertshrestha and All-Star TSIF, who is ranked in the top 5% of our community.

Just yesterday, robertshrestha touched on MEMC's particularly bright balance sheet: "Rock-solid financial position. War chest of cash and little debt. Big solar trends in its favor should keep the free cash flowing for years."

In a pitch from last Friday, TSIF focused on the sunny side of MEMC's recent slide. Here's an excerpt:

MEMC recently announced a loss that surprised analysts. At the same time it announced buying a privately held solar panel installer SunEdison … Since MEMC has a good supply of cash, I consider the SunEdison deal to be positive. As far as the loss this quarter, again due to their cash position and the loss being partially caused by a shift in manufacturing locations and the associated costs and that solar power is "catching" on, albeit more slowly than expected a few years ago, that MEMC will bounce back. This pick may take a while to mature, but I like the 10% discount I received from the market today.

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Last edited by Prince damin on Sat, 07/24/2010 - 12:32 | Write to author: Brian D. Pacampara | Bookmark and Share