It's time for some introspection, as is usually the case at the start of a new year. We saw some exceptional growth for solar stocks in 2007, but will the good times keep on rolling? I still believe that it's too early in the solar game to be picking the winners, and I will continue to argue that solar valuations are based on overly optimistic assumptions. Good companies are not always good investments, and there are many good solar companies that are simply too expensive to classify as good investments. But then again, I've been saying this for awhile now and have been proven wrong time and time again. Maybe the time has come for me to admit that solar stocks are too hot to handle.

Here follows a list of the top performers in the solar sector during 2007.

First Solar (FSLR)            795.24%
Ascent Solar (ASTI)         757.24%
JA Solar (JASO)              365.40%
Hoku Scientific (HOKU)   336.78%
SunPower (SPWR)           250.79%
Spire (SPIR)                   185.63%
Trina Solar (TSL)            184.66%
SolarFun (SOLF)             179.30%
Canadian Solar(CSIQ)      168.81%
SunTech Power (STP)     142.05%
Evergreen Solar (ESLR)    128.14%
MEMC Electronics (WFR) 126.09%
LDK Solar (LDK)              74.11%
DayStar (DSTI)                67.11%
China Sunergy (CSUN)     50.18%

What's in store for 2008? The Photon Photovoltaic Technology Show, to be held January 15-18 in Shenzhen, China, may offer some clues. Many publicly traded solar stocks will present at the conference, and hopefully the event will provide greater confidence in new polysilicon supply for the solar industry. If solar companies announce more polysilicon deals at the day devoted to silicon (January 15), the event could serve as a positive catalyst for solar stocks.

Disclaimer: I don't own any of the stocks mentioned above. I don't own a solar panel.