Analyst Shifts Stance On First Solar, Upgrades To Hold Amid ESG Push

GLJ Research has upgraded First Solar Inc FSLR from Sell to Hold with a price target of $157.56.
First Solar said in its Q1 earnings conference call that based on the current form factor of its modules, it expects to benefit from approximately $0.17 per watt for each module sold as part of the inflation reduction act.
For the made-in-the-USA modules, FSLR plans to sell in out years, of the $0.23/watt in costs it reported in Q1, due to taxpayer welfare/handouts in the inflation reduction act (IRA), $0.17/watt of that will be paid for by the U.S. government, said the analyst.
With solar prices in free-fall due to record excesses, the question is at what price is FSLR at risk of seeing customers renege on its long-term contracts, and will we see those prices, in the U.S. market, this year.
The analyst thinks the story of First Solar is still strong and many details around the IRA bill are still unknown to make a clear pitch on growth.
The analyst added that the company’s $21.7 billion market cap is making it an easy play for large money-managers who want renewable/solar/ESG exposure.
Yet, given the analyst’s view that the solar industry will be plagued by a rerating lower of valuation multiples, while the analyst expects FSLR to outperform its peers, there still is a chance of it ending the year lower.
Also Read: Renewables Revolution: US Green Energy Poised for 'Staggering' Growth, According To BloombergNEF Report
Price Action: FSLR shares are trading lower by 1.10% at $206.44 on the last check Friday.

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