First Solar (FSLR): Still shining?

Posted Mar 3rd 2009 2:30PM by Steven Halpern
Filed under: International Markets, Newsletters, Commodities, Oil, Green Stocks, Obama Picks

"The solar sector has been notably weak, including First Solar (NASDAQ: FSLR)," says Stephen Leeb. Despite the setback, the editor of The Complete Investor rates the stock a high risk buy.

"First Solar is one of the few whose earnings outperformed consensus estimates: its fourth-quarter results reported yesterday after the market's close were nearly 25% better than estimates.

"First Solar made $1.61 per share this past quarter; Wall Street was expecting $1.30 per share. Revenues were also ahead of estimates, although the company reduced 2009 revenue estimates by about 10%, citing short-term credit concerns for customers.

"Still, management sees at least 45% top-line growth for the full year. While manufacturing advances kept cost reductions on track and lowered its module cost per watt below $1 during the period, margins felt some pressure courtesy of the economic environment.

"First Solar remains the low-cost leader in the sector, and has the wherewithal to survive the negative operating environment.

"In our view, the recent drop in the share price appears to be a knee-jerk reaction to the company's short-term headwinds, with no regard for the tremendous tailwinds solar stocks are receiving from the Obama administration.

"Michael Ahearn, the company's CEO, summed it up best on the conference call: 'In three to five years, the market outlook for solar has never been better, but the short-term outlook for the solar industry has never looked more difficult.'

"We continue to like First Solar as a high-risk play, trading at a PEG well below 1, and we see the latest weakness as a buying opportunity."

Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.

Tags: alternative energy, AlternativeEnergy, complete investor, CompleteInvestor, first solar, fslr, obama stocks, ObamaStocks, solar energy, solar power stocks, SolarEnergy, SolarPowerStocks, stephen leeb, thestockadvisors.com

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Reader Comments (Page 1 of 1)

3-03-2009 @ 6:28PM

ryan said...

First Solar is the leader in the solar industry. With initiatives from the Obama administration, First Solar will be in even better standing in 5 years. FSLR may be somewhat volatile and risky right now but investors are confident in FSLR and sentiment is bullish (http://www.predictwallstreet.com/forecast.aspx?symbol=FSLR). It's about timing with this company but I think they are a good bet.