Investors seem to be hopeful that the time has come for solar panels to break out of their niche market and find a wider range of customers. Shares of LDK Solar (LDK) climbed on Jan. 2 after the company released a financial outlook for the next two years and Akeena Solar's (AKNS) stock price soared on news of a licensing deal with a major producer that will launch the company's cost-saving technology in Europe and parts of Asia.

The 5.4% gain in LDK shares to trade at $49.56 was baffling, considering that the company hasn't offered investors anything new to convince them of its ability to source polysilicon at discount prices or to boost its gross margins. The stock got slammed down by almost 27% just a few days before Christmas on the belief that LDK was being overly optimistic in its price estimates for raw materials and its production outlook for the new year.

The 42% jump in Akeena's shares to $11.31 on Jan. 2 made much more sense, given that the new licensing agreement expands the Los Gatos (Calif.) company's relationship with Suntech Power Holdings (STP), a leading producer of solar panels. Suntech expects to sell more than 10 megawatts of the Andalay solar panels to the licensed regions this year.

"Suntech could be number one on a volume basis by next year, so it's a great partnership for Akeena," said Brian Yerger, an equity analyst at Jesup & Lamont, which has a neutral rating on the stock. He said it's not yet clear, however, how much additional revenue the licensing deal will bring Akeena. (Empire Financial, with which Jessup & Lamont recently merged, has done investment banking with Akeena within the past 12 months.)

The licensing agreement authorizes Suntech to distribute Akeena's innovative, lower-cost solar panel technology, Andalay, in Europe, Japan and Australia. In September, Suntech agreed to manufacture and deliver 10 to 14 megawatts of Andalay solar panels to Akeena for distribution in the U.S. during 2008.

Both stocks may well have gotten some extra lift from the fact that crude oil briefly touched $100 per barrel for the first time on Jan. 2. If that's a sign of longer term trend in oil prices, it could fuel the market's psychological readiness for alternative energy technologies across the board.

What's significant about the partnership between Suntech and Akeena is that it should help solar panels compete with low-cost coal-fired electricity that comes off the power grid. The Andalay panels are equipped with built-in wiring, grounding and racking that allow them to be installed on roofs at a much lower cost of labor and also gives the panels a more aesthetic appearance.

The main benefit of Akeena's the new deal will be fatter margins, compared with the thin margins the company earns on its pure installation business, Yerger added.

When a leading solar panel producer like Suntech can lower the cost to the end-user not only by improving the manufacturing process but also "through something as mundane as installations," it's sure to expand its market share, Yerger said.