At The Motley Fool, we poke plenty of fun at Wall Street analysts and their endless cycle of upgrades, downgrades, and "initiating coverage at neutral." So you might think we'd be the last people to give virtual ink to such "news." And we would be -- if that were all we were doing.

But in "This Just In," we don't simply tell you what the analysts said. We'll also show you whether they know what they're talking about. To help, we've enlisted Motley Fool CAPS, our tool for rating stocks and analysts alike. With CAPS, we'll be tracking the long-term performance of Wall Street's best and brightest -- and its worst and sorriest, too.

And speaking of the best ...
Miserable news for solar power investors -- Goldman Sachs (NYSE:GS) hates your stock. Yesterday, the megabanker announced downgrades on two of the most popular companies in the sector, First Solar (NYSE:FSLR) and SunPower (NASDAQ:SPWRA). First Solar promptly lost 20% of its market cap, while SunPower shed 12%, for a combined loss of $3.7 billion in value. Both stocks continued to tumble this morning.

But as bad as that sounds, the damage didn't end there. LDK Solar (NYSE:LDK) has dropped 17% since the Goldman news broke, Evergreen Solar (NASDAQ:ESLR) is down 22%, Suntech Power (NYSE:STP) 23%, and Solarfun (NASDAQ:SOLF) is having no fun at all -- down 25%.

All this fuss over just one downgrade?
It does seem like a bit of an overreaction, doesn't it? But remember, Goldman is a good enough banker that it attracted an investment from the master himself, Warren Buffett, last month. When Goldman speaks, markets move.

But should it?
It pains me to admit this, but I honestly don't know. While CAPS tracks the comings and goings of more than 14 dozen professional stock-pickers, Goldman remains the odd man out. I can tell you how good JP Morgan is at picking stocks. I can give you the lowdown on Banc of America. Heck, if you're interested in someone as esoteric as Credit Suisse or even Barclays, we've got you covered. But Goldman stubbornly refuses to submit its ratings to our data provider, with the result that no one really knows how good Goldman is at its job.

I can tell you this: Goldman downgraded First Solar and SunPower all the way from "buy" to "sell" yesterday, warning that government subsidies for solar power in Europe are drying up, and that this will soon cause an "oversupply in the solar market." Goldman sees little likelihood that "liberal subsidies" in Germany and Spain will be renewed any time soon, as European governments grasp for cash to save their struggling banking sectors.

Silver lining 'round a Goldman downgrade
And yet, at the same time that Goldman was worrying over government price supports in Europe, the U.S. government was busy passing a landmark eight-year extension of solar subsidies right here at home. And in a final bit of irony, the U.S. didn't do this despite the cost of saving its own banks -- but as part of the same Bailout Bill!

And if that sounds promising to you, then consider this bit of dicta from Goldman's so-called downgrades: "We strongly believe that SunPower and First Solar are two of the best solar companies in the world and that both will be part of the growing solar industry for years to come."

Putting it all together
To sum up here, we've got:

  • An apparently conflicted banker, busily downgrading companies that (a) it apparently loves, and (b) it believes have strong growth prospects ahead.
  • No public record -- or at least CAPS record -- of performance for said banker, which keeps its ratings close to the vest.
  • A strong vote of support for the banker's competence nonetheless, in the form of the Buffett investment.
  • ... Despite its famous prediction that oil would hit $200 earlier this year, an assertion that's proved massively wrong.

Where does that leave us? Right where it always does, I'd say -- buying what looks cheap, and avoiding what looks expensive, regardless of Goldman's opinion.

In that regard, consider that based on the estimates bouncing 'round Wall Street these days, First Solar is expected to grow its profits at the barn-burning clip of 56% per year over the next five years. If correct, that kind of growth makes even this stock's lofty 43 P/E look attractive. In contrast, SunPower's 70 P/E still looks pricey based on growth estimates.

In further contrast, Suntech Power, LDK, and Solarfun -- each of which fell in sympathy with Goldman's downgrades yesterday, though Goldman said nothing about them -- all sell for relatively low prices today, despite growth estimates several times as large as their P/Es.

Foolish takeaway
Unless and until Goldman decides to make its performance record public so that we can track it via CAPS, we can never be entirely certain just how good it is at its job. I can say one thing with certainty, though: Thanks to Goldman's downgrades, a lot of great solar companies are finally cheap enough to own.

On Oct. 7, 2008, Fool co-founder David Gardner and his Motley Fool Pro team invested $1 million in a portfolio designed to help you make money in any market. In the coming weeks, the team, relying heavily on proprietary CAPS "community intelligence" data, will establish long and short positions in a broad range of securities, including common stocks, publicly traded put and call options, and exchange-traded funds (ETFs). To learn more about Motley Fool Pro and to receive a private invitation to join, simply enter your email address in the box below. 

Fool contributor Rich Smith does not own shares of any company named above. You can find him on CAPS, publicly pontificating under the handle TMFDitty, where he's currently ranked No. 839 out of more than 115,000 players. Suntech Power Holdings is a Rule Breakers recommendation. The Fool has a well-tanned disclosure policy.