First Solar Is 'Among Most Crowded Trades,' 5 Analysts Take Deep Dive Into Q3 Print

Shares of First Solar Inc FSLR remained volatile in early trading on Wednesday, after the company reported mixed quarterly results.

The results came amid an exciting earnings season. Here are some key analyst takeaways from the earnings release.

• BMO Capital Markets analyst Ameet Thakkar maintained an Outperform rating, while reducing the price target from $226 to $216.
• Roth Capital Partners analyst Philip Shen reiterated a Buy rating and price target of $230.
• Piper Sandler analyst Kashy Harrison reaffirmed an Overweight rating and price target of $235.
• KeyBanc analyst Sophie Karp maintained a Sector Weight rating on the stock.
• Raymond James analyst Pavel Molchanov reaffirmed a Market Perform rating on the stock.

Check out other analyst stock ratings.

BMO Capital Markets: Despite reporting lower-than-expected revenues for the quarter, First Solar delivered “much stronger than expected EPS and margins" and raised midpoint of 2023 EPS guidance by 10 cents, Thakkar explained in a note.

“More importantly, FSLR added 6.8 GWs of net bookings at $0.30/watt ASP which covers sales in the 2027-2029 timeframe,” the analyst wrote. “In an increasingly turbulent time in energy transition FSLR offers the best visibility."

Roth Capital Partners: Although First Solar reported mixed third-quarter results, management drove higher-than-expected bookings of around 10 GWs in the quarter and “7GW since the last earnings call at 30c/W ex-India,” Shen wrote in a note.

“We remain bullish on the company's ability to drive more bookings over time at attractive pricing as FSLR remains patient for the geopolitical dynamics to swing back to their favor, i.e. UFLPA enforcement of Tier 2s, UFLPA enforcement on new categories such as aluminum frames, potential for more protectionist tariffs, etc,” the analyst added.

Piper Sandler: “Mgmt emphasized that FSLR is the only vertically integrated domestic manufacturer, which becomes increasingly important when the IRA domestic content requirements step up to 50% in 2026,” Harrison wrote in a note.

“Furthermore, mgmt reiterated their view that FSLR is the lowest cost domestic production as evidenced by the labor intensity of a recently announced US cell production facility by a large Chinese c-Si competitor,” she added.

KeyBanc: First Solar’s quarterly results were strong, “beating our consensus estimates across all metrics but revenue, driven by lower sales volumes,” Karp said.

“While the Company's backlog is sold out through 2026, a recent collapse in cSi pricing and ongoing competitor capacity announcements in the U.S. lead to questions on the sustainability of above-average pricing, and the possibility of contract cancelations, which the Company has fielded on the call,” the analyst added.

Raymond James: “First Solar is among the most crowded trades in clean tech, and the investor excitement is overwhelmingly due to the Section 45X manufacturing incentive,” Molchanov wrote in a note.

“As the new capacity in Ohio and India ramps up, there is an elevated risk of top line and (especially) margin shortfalls,” the analyst said. “More broadly, the story is also tied to protectionism in the U.S., a market that accounts for the vast majority of revenue."

FSLR Price Action: Shares of First Solar had declined by 0.33% to $141.98 at the time of publication Wednesday.

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