* Lack of clarity a big concern
* Analysts say shares to remain under pressure
* Q1 shipments miss forecast, co sees lower Q2 shipments
* Barclays halves target, Oppenheimer cuts target by 47 pct
* Shares fall as much as 22 pct (Recasts; adds details, more analyst comments, updates share movement)
By Adveith Nair
BANGALORE, June 2 (Reuters) - Shares of Chinese solar-cell maker Canadian Solar (CSIQ.O) fell as much as 22 percent as investors aggressively sold the stock on the company's lack of clarity over a subpoena from U.S. regulators.
At least two brokerages slashed their price targets on the company's shares, which were down 14 percent at $10.20.
The shares had earlier fallen to a low of $9.25, and were among the highest percentage losers Wednesday morning on Nasdaq. The stock is now down over 70 percent from a January year-high.
In a statement after markets closed Tuesday, the company reported first-quarter shipments below its prior view and said its board had launched a probe following a subpoena from the Securities and Exchange Commission (SEC) requesting documents relating to some sales transactions, "among other things."
"At the first blush, it is a negative," Simmons & Co analyst Burt Chao said. "With the company being so unclear about what the subpoena actually entailed, investors are going to take a more conservative approach."
Canadian Solar did not immediately respond to phone calls and e-mails seeking comment.
"To us, the SEC subpoena and pending revision to fourth-quarter revenue, both appear to center on sales in the fourth quarter to customers who returned modules in the first quarter," Oppenheimer analyst Gary Hsueh said.
"Our key concern is: what instigated the returns? In a tight demand environment, this rates as paranormal activity."
The company, which delayed its first quarter results, said it may revise its fourth quarter and full-year results as it now intends to recognize sales only after receiving full cash payments from certain customers.
Canadian Solar, which was founded in Ontario, Canada, but has manufacturing operations in China, said it will cooperate with the Securities and Exchange Commission inquiry.
Meanwhile, Lazard Capital Markets downgraded the company to "hold" from "buy," citing overhangs from the investigation.
Deutsche Bank maintained its 'hold' rating on the stock and said the absence of clarifying information was offset by expectations for a stronger shipment outlook for the second half.
Analysts say the lack of clarity shrouding the entire investigation was likely making investors jittery.
Simmons' Chao said when SunPower Corp SPWRA.O faced a similar issue, the company had given investors an idea of what to expect, making them more comfortable with the news. [ID:nN16522308]
"And anyway, there is a stigma attached to Chinese solar stocks as a group as far as their disclosure and accounting go," Wedbush analyst Christine Hersey said by phone.
Chao said Chinese photovoltaic (PV) cell maker Solarfun Power Holdings Co Ltd SOLF.O had taken a step in the right direction, as it became the first Chinese solar company to voluntarily provide a cash flow statement.
"It is really important for a company to be very open and explicit," Chao said. "Right now they seem to have taken the approach of let's figure this out, and then come out and announce it."
Barclays Capital analyst Vishal Shah, meanwhile, halved his price target on the company's stock to $11.
"We expect shares to remain under pressure until the SEC investigation is concluded and also expect ongoing execution concerns to limit near-term earnings per share upside," Shah wrote in a note to clients.
The analysts agreed that the shares could fall further.
"There is no guarantee that this is a floor," Wedbush's Hersey said. "We don't really know what the issue is and how far it goes."
Canadian Solar said its estimated first-quarter shipments came in below its April forecast, and guided towards sequentially lower second-quarter shipments. [ID:n01170500]
The company's relatively weak forecast came even as other makers of photovoltaic solar equipment saw demand surge as the market rebounded from a weak 2009.
Oppenheimer's Hsueh said Canadian Solar's second-quarter shipment view was "more evidence of paranormal activity."
"(This) is in sharp contrast to recent checks in Asia suggestive of 10 percent to 15 percent of quarter-over-quarter megawatt growth."
Reporting by Adveith Nair in Bangalore; Editing by Vyas Mohan, Prem Udayabhanu