Barclays Downgrades First Solar As Tariff Tailwinds Subside

First Solar, Inc. FSLR was considered an election hedge that would benefit from a Trump win due to the potential for tariff extensions, according to Barclays, which said Tuesday that the potential has now faded. 

The First Solar Analyst: Moses Sutton downgraded First Solar from Equal Weight to Underweight and reduced the price target from $86 to $60.

The First Solar Thesis: The company’s margins come into focus as Section 201 tariffs are set to close by February 2022, and there are no signs of an extension, Sutton said in the downgrade note.

“But with near-term headwinds in the c-Si supply chain, we would not be surprised if FSLR manages to offer some developers a hedge and capture some decent economics for 1H22, despite the tariff drop off,” the analyst said. 

"Even so, unless new protection emerges (unlikely under Biden; SEIA likely captures the Dem’s support), 2022+ is still set to drop off materially, despite our attempt to credit as much margin per watt as we see feasible."

FSLR Price Action: Shares of First Solar were down 2.27% at $91.31 at last check Tuesday.