solar stocksLDK Solar (LDK) reported strong second-quarter results, accompanied by improved margins, and raised its guidance for the third quarter and the full year.

The solar company's revenue soared 147% to $565.3 million in the quarter and earnings per share jumped to 36 cents from six cents last year. Results also handily beat analysts' estimates for revenue of $458 million and earnings of 22 cents share.

What had investors even more excited was the company's third-quarter and 2010 outlook. For the third quarter, LDK sees revenue of $570 million to $600 million, ahead of the Street expectation at $422 million. For 2010, the company raised its guidance from a previous forecast for revenue of $1.6 billion to $1.7 billion to $1.95 billion to $2 billion. Again, ahead of the consensus at $1.59 billion.

SunPower (SPWRA) revenue wasn't as impressive, but earnings came in better than expected; the company said its profit margins would rise in the second half of the year as it trimmed manufacturing costs.

The company reported adjusted earnings per share of 15 cents, topping the 10 cents per share that analysts had on average forecast, according to Thomson Reuters. Revenues rose 28% to $384 million, slightly below analysts' forecast of $401 million.

SunPower also slightly raised its full-year profit forecast from a range of $1.25 to $1.65 per share to $1.35 to $1.65 per share.

The maker of solar panels also said its joint venture with Taiwan's AU Optronics for a new manufacturing plant in Malaysia would speed its production cost cuts and help make its existing plants more profitable.

Solar shares sold off Tuesday, possibly in reaction to JA Solar's (JASO) earnings miss. But there are other concerns. Solar companies experienced strong demand so far this year as many companies sold out of supplies. Manufacturing capacity, however, has been increasing and demand may ease as German subsidies expired, causing concern among investors of a pricing squeeze.

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