Why Shares of Yingli Green Energy (ADR) Plunged 12% Today

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of solar panel manufacturer Yingli Green Energy (ADR) dropped as much as 12% today after raising doubts about its future survival.

So what: Yingli Green Energy's recently filed 20-F annual filing included the dreaded line, "There is substantial doubt as to our ability to continue as a going concern." A third consecutive year of losses and $2.1 billion in debt has finally brought up real concern that the company can't survive very long into the future.

Now what: The risk of borrowing billions of dollars to build manufacturing facilities in China is finally hitting investors and I don't think Yingli will last much longer. I've been discussing that risk for years (see articles here, here, or here) and I just don't see how Yingli could make enough money to pay back debts and leave a profit for shareholders. This is a stock I would stay far, far away from because there are much better ways to play the booming solar market today.

The article Why Shares of Yingli Green Energy (ADR) Plunged 12% Today originally appeared on Fool.com.

Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.