Yesterday, the US Senate voted Tuesday to extend solar tax credits for the next eight years. The news is positive for the following alternative energy stocks, I have covered here: PWER, NX, and ATA.TO.

Despite significant exposure to the US residential real estate market, I believe that Quanex (NYSE: NX), a recent spin-off, has solid appreciation potential over the next few years. My optimism is based on the following two factors: the company’s growing presence in the thin film solar market, and a pristine balance sheet ($50 million in net cash, $2 million in debt, and $20 million in cash pending receipt), which should allow NX to pursue highly accretive acquisitions in the current weak operating environment. In addition, the stock’s low valuation, already appears to reflect the well-known problems in US residential real estate. As such, a slight sentiment change in the macro environment, combined with a growing recognition of NX’s solar and other green growth opportunities, could lift the shares.

SolarFun (SOLF), a Chinese manufacturer of polysilicon-based solar modules, recently announced financial results, which were greeted negatively by the market, but which were actually positive in certain respects. Specifically, the company’s detailed breakdown of capital outlays into cap-ex and pre-payments to suppliers, provide a more accurate measure of the company’s true profitability, and give some indication of future financing needs and cash-flow potential of SOLF. In addition, the deal with Q-Cells and the company’s gross margin projections for 2009, both signal interesting possibilities over the next year. Combined, the above factors can provide certain guidelines of how to speculate, and hopefully make money, in SOLF’s stock going forward.

This morning ATS Automation (ATA.TO) reported financial results that far exceeded my expectations. Overall, my feeling is still that ATA.TO remains undervalued and the stock price should increase significantly as more investors recognize that the company’s turnaround is progressing smoothly and the future outlook for the business is exceptional given the strength in solar and other alternative energy markets.

This morning Canadian Solar (CSIQ) reported exceptional earnings results, and yet I still remain convinced that the company will need to dilute shareholders significantly in the year ahead in order to meet their lofty 2009 expectations.

Given our past discussion concerning the financing needs of several polysilicon-based module manufacturers, we were not taken aback by CSIQ’s latest secondary announcement, and we think this is just the start of the company’s financing journey given its future purchase obligations.

In this post we will take a look at the future capital needs and funding requirements of four Chinese polysilicon-based PV Manufacturers.

Briefly, our conclusion, based on current low cash levels, high outstanding short-term debt as a percentage of total capital, and future capital needs, in the form of outstanding purchase obligations listed in recent 20-F filings, is that nearly all of the companies mentioned here (i.e. TSL, CSIQ, SOLF, YGE) will have a significant weakening of balance sheets in the near term, as short-term debt levels soar to support growing operating cash losses and purchase obligations. The prospect of immediate dilution via direct equity share offerings is clearly remote, as past history shows that these companies prefer to use convertible debt issues, as opposed to straight equity, as a longer-term financing vehicle.

(Please note: Complete spreadsheets, which are updated quarterly, with all of our financial assumptions about the polysilicon-based PV Manufacturers mentioned here, are available to subscribers of Envoy Global Research).

In this post, I will address the two most common criticisms of our article last month on several polysilicon-based PV manufacturers and thereby hopefully clarify the financial issues that confront many of these polysilicon-based PV manufacturers.

In this post, I’ll take a look at ATS Automation (ATA.TO or ATSAF.PK ), a Canadian company that primarily specializes in providing automated manufacturing systems to various sectors, including the fast-growing alternative energy industry. In addition, the company also owns PhotoWatt France, a provider of photovoltaic solar energy cells and modules and is a leader in the manufacture of UMGSi silicon, a lower grade of silicon that can be acquired more readily than polysilicon.

ATS Automation has been in restructuring mode since September 2007, when a group of shareholders successfully ousted past management and installed a whole new leadership team. Recently, the company’s fourth quarter fiscal 2008 financial results demonstrated significant financial improvements and a strong outlook for fiscal 2009, prompting me to take a closer look at the company. Although the stock has appreciated dramatically from its low earlier this year, I still believe that ATS Automation (ATA.TO), has significant upside (100%) in the next one to three years.