This hasn't been a pretty week for shareholders of Suntech Power (NYSE: STP). A down day Tuesday turned into a downright pummeling on Wednesday after the company released earnings and announced an acquisition.

Revenue was up 19% sequentially to $743.7 million in the quarter as module shipments rose 25.3% and average selling price fell slightly. Margins fell to 16.4% from 18.2% in the second quarter as costs to make panels also rose, giving Suntech a hit from both ends. Suntech did say it anticipated raising sales price during the fourth quarter, reversing a long declining trend in solar.

Suntech also announced an acquisition of 375 MW of ingot and wafer slicing capacity for $127 million. The added capacity will lower costs per watt and is expected to be accretive immediately on closing.

But analysts thought Suntech paid too much for the acquisition compared to recent deals. The cost of $0.79 per watt is nearly double the $0.40 Suntech says it can build wafer capacity for, so the company is paying a premium to add capacity quickly.

The market took this report so badly because the acquisition was viewed as too expensive, and we've become used to blowout earnings from competitors. JA Solar (Nasdaq: JASO) and Solarfun (Nasdaq: SOLF) both reported outstanding earnings last week, and we might be getting spoiled at this point.

I'm a little worried Suntech seems to be in a "grow for growth's sake" mentality trying to keep the title of biggest module producer. The added size might have its advantages, but right now it's costing shareholders a pretty penny to get there.

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Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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