Trefis raises First Solar estimate to USD 45 p/s

Stock research service Trefis has lifted its price estimate for First Solar Inc (NASDAQ:FSLR) to about USD 45 per share from USD 37 per share.

On Thursday Trefis said the thin-film module maker is well positioned to survive downturns in the solar market with the more than USD 2 billion (EUR .76bn) in net cash it holds and the cadmium-telluride (CdTe) technology's higher efficiency potential compared to silicon panels.

“While the solar industry has witnessed a downturn over the last year, amid projected declines in demand from major markets such as China and an oversupply of panels, we believe that First Solar could outperform in the long run, considering its strong technology road map and its cash-rich balance sheet,” Trefis said in the note.

In the autumn of 2016 First Solar announced a move from Series 4 production to Series 6 production over the course of 2017 and 2018, whilst cancelling its Series 5 product. Trefis believes that the decision will bring positives over the long term. The Series 6 module, expected in the second quarter of 2018, will cost much less than Series 4, while offering higher efficiency of over 18% at launch.

In 2016 roughly 83% of First Solar’s sales came from the US, but Trefis said the solar company should be able to diversify its revenue stream in the long run. “Per the company’s Q1’17 earnings presentation, over half its mid-to-late stage booking opportunities came from international markets.” India and Japan are on the list.

(USD 1 = EUR 0.88)

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