What Did Susquehanna Financial Like About First Solar To Upgrade Stock?

First Solar, Inc. FSLR seems to be witnessing improving demand and pricing power for its thin-film panels, according to Susquehanna Financial Group.

The First Solar Analyst: Biju Perincheril upgraded the rating for First Solar from Neutral to Positive, while raising the price target from $89 to $120.

The First Solar Thesis: Average selling prices for new bookings “appear to be stabilizing” due to an increase in c-Si panel prices and “potential supply chain disruptions stemming from Xinjiang forced labor concerns,” Perincheril said in the upgrade note.

Backlog at First Solar’s modules segment suggests “recent bookings are in the high $0.20s range,” the analyst noted.

“While 2022 module prices are already set, recent strength suggests prices could be flat y/y in 2023 and perhaps show an uptick in 2024. We are currently modeling average ASPs of $0.32/W this year, declining to $0.285 next year, then holding flat in 2023, and inching up to $0.29 in 2024,” he added.

Apart from higher pricing for new booking, “supportive policy developments including manufacturing credit,” meeting targets for cost savings, and S6 panel efficiency improvements are likely to be the other catalysts for First Solar’s performance, Perincheril further stated.

FSLR Price Action: Shares of First Solar had risen by 2.36% to $88.07 at the time of publication Monday.

Photo: First Solar