Our Stock of the Week is First Solar, Inc. (FSLR). First Solar’s primary customers are utility-scale solar farm operators. FSLR manufactures photovoltaic solar panels and offers associated solutions, including project development, financing, engineering, procurement, construction, operations, and maintenance. Its primary competitive advantage is the use of thin-film technology as opposed to crystalline silicon. This allows for lower production costs and higher efficiency in high-temperature conditions.
With the growth of large data centers to help power AI, the demand for cheap energy is growing quickly. Solar farms are one of the solutions that are FSLR’s primary niche.
One upcoming catalyst for FSLR is that the Biden Administration is expected to remove a tariff exemption for bifacial solar modules that are imported to the US. As a domestic producer, this will be a major benefit for First Solar.
I don’t typically like to buy stock in front of earnings, but I plan to hold some First Solar, which will report on Wednesday, May 1, after the market closes. Barrons listed FSLR this weekend as one of the few stocks, along with Nvidia, Super Micro, and Broadcom, which is expected to see revenue growth of more than 30% this quarter.
What is most impressive about FSLR is that it has tremendous EPS estimates but trades at a trailing PE of just 23. Current estimates are for EPS growth of 75% in 2024 to $13.54 and a further 25% increase in 2025 to $20.91.
The main thing holding back First Solar is concerns that a Trump administration may put policies in place that may hurt the solar sector, but FSLR production will be sold out through 2026 with over $23 billion in orders through 2030.
Technically, the stock has been improving and is set up well for a positive reaction to upcoming earnings and tariff news.
This post is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this post. Do not buy, sell, or trade the stocks mentioned herein. We WILL actively trade this stock differently than discussed herein. We will sell into strength and buy or sell anytime for any reason. We will actively trade into any unusual activity. At the time of this post, principals, employees, and affiliates of Shark Investing, Inc. and/or principals, clients, employees, and affiliates of Hammerhead Financial Strategies, LLC, directly or indirectly, controlled investment and/or trading accounts containing positions in FSLR. To accommodate the objectives of these investing and/or trading accounts, the trading in these shares will be contrary to and/or inconsistent with the information contained in this posting.
