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Tempe, Arizona-based First Solar, Inc. (FSLR) is a solar technology company. It manufactures PV solar modules with a thin film semiconductor technology that provides a lower-carbon alternative to conventional crystalline silicon PV solar modules. With a market cap of $19.5 billion, First Solar's operations span the Americas, Europe, and Indo-Pacific.
First Solar has underperformed the broader market over the past year but underperformed in 2024. FSLR stock has gained 4.9% on a YTD basis and 21.2% over the past year compared to the S&P 500 Index’s ($SPX) rally of 25.3% in 2024 and 32.9% over the past 52-week period.
However, FSLR has outpaced the First Trust NASDAQ Clean Edge Green Energy Index Fund’s (QCLN) decline of 21.8% in 2024 and 7.9% over the past 52 weeks.
Shares of First Solar dropped over 1% following its disappointing Q3 earnings release on Oct. 29. Although the company reported a substantial 10.8% year-over-year growth in net sales, reaching $887.7 million, it missed Wall Street’s topline expectations by a large margin. Moreover, compared to Q2 results, its topline dropped around 12.2%, driven by a decrease in the volume of MW sold and a product warranty reserve charge. Moreover, the termination of the Plug Power contract and unfavorable average selling prices of its modules in markets like India resulted in First Solar lowering its full-year net sales guidance to $4.1 billion - $4.3 billion from the previously announced $4.4 billion - $4.6 billion, making investors jittery.
FSLR stock further plummeted 10.1% on Nov. 6 following the Presidential election results. President Trump's support for traditional energy sources created concerns for companies, which led to a massive sell-off of renewable energy-focused stocks on Wall Street.
For the current fiscal, ending in December, analysts expect FSLR to report a 70% year-over-year growth in adjusted EPS, reaching $13.16. The company has a mixed earnings surprise history. FSLR surpassed analysts’ bottom-line estimates in three of the past four quarters while missing on another occasion. Its adjusted EPS of $2.91 for the last reported quarter missed the consensus estimates by 6.1%.
FSLR stock has a consensus “Strong Buy” rating overall. Among the 34 analysts covering the stock, 26 recommend “Strong Buy,” one advises “Moderate Buy,” and seven suggest a “Hold” rating.
This configuration is more bullish than a month ago when 24 analysts recommended “Strong Buy” ratings.
On Nov. 13, Barclays PLC (BCS) analyst Christine Cho maintained a “Buy” rating on FSLR while lowering the price target to $275.
FSLR’s mean price target of $277.77 represents a premium of 52.5% to current price levels. The Street-high target of $360 suggests a massive potential upside of 97.7%.
