FSLR
FSLRFirst Solar is a leading American manufacturer of solar panels within the semiconductor industry.
It is widely recognized as a utility-scale solar specialist, distinct for its advanced thin-film module technology and vertically integrated manufacturing process.
Updated: January 14, 2026, 16:00 EST
Investment Opinion: Should I buy FSLR Today?
Based on the provided analysis, here is a comprehensive assessment of FSLR.
Technical Analysis: FSLR is exhibiting high volatility, with a sharp recent pullback placing it near the higher end of its 52-week range. While the stock has shown periods of market outperformance, its high beta and significant historical drawdown suggest that investors should be prepared for sizable price swings. The current position indicates limited short-term downside protection after the recent decline.
Fundamental Analysis: First Solar's foundational business is strong, characterized by impressive revenue growth, high profitability margins, and an excellent financial position with minimal debt. However, operational efficiency shows room for improvement, with moderate returns on equity and assets, indicating that the company's growth has not yet been fully optimized for shareholder returns.
Valuation & Risk: The valuation presents a mixed picture. A low PEG ratio suggests the stock is undervalued relative to its growth potential, but premium multiples like EV/EBITDA indicate high expectations are already baked into the price. The primary risks are its high volatility and sensitivity to government energy policies and sector competition, which could impact future performance.
Buy Recommendation:
First Solar presents a compelling opportunity for growth-focused investors who can tolerate volatility. Its robust financial health, strong profit margins, and significant earnings growth potential, as signaled by the low PEG ratio, are powerful positives. While the stock carries higher risk and a premium valuation, its solid fundamentals support a bullish long-term outlook for investors aligned with the renewable energy sector.
FSLR 12-Month Price Forecast
RockFlow Model Forecast: Three Scenarios for 2026
Based on the comprehensive analysis provided, here is a 12-month outlook for First Solar (FSLR):
12-Month Outlook for FSLR
The outlook for FSLR is cautiously optimistic, driven by its strong fundamental position in the growing renewable energy sector. Key positive catalysts include its robust revenue growth, industry-leading profitability, and a debt-light balance sheet, which position it well to capitalize on long-term demand for solar energy. However, investors must be prepared for significant volatility, as the stock's high beta and sensitivity to shifts in government energy policy and competitive pressures are the primary near-term risks. Given the premium valuation and the absence of a specific analyst target, a realistic 12-month price range would likely see the stock trading between $220 and $280, reflecting its high-growth potential balanced against substantial price swings inherent to the sector.
Wall Street Consensus
Most Wall Street analysts are optimistic about FSLR's 12-month outlook, with consensus target around $236.45, indicating expected upside potential.
Bulls vs Bears: FSLR Investment Factors
Overall, FSLR has investment potential but also faces challenges. Here are key factors to weigh before investing.
Bullish
- Strong Q3 Earnings Beat: Company exceeded top- and bottom-line analyst estimates.
- Positive Analyst Outlook: Multiple analysts raised price targets following strong results.
- Solid 2025 Performance: Stock jumped 35% in 2025, reaching a 52-week high.
- Impressed Shareholders: The company provided a solid future outlook that boosted confidence.
Bearish
- Analyst Downgrade Concerns: A recent analyst recommendation downgrade triggered a significant sell-off.
- Valuation Concerns: Stock pulled back due to worries it was overvalued.
- Future Booking Visibility: Renewed concerns exist around 2026 order visibility and strategy.
- Recent Price Volatility: Stock dropped 13% in one week, showing sensitivity to news.
FSLR Technical Analysis
Overall Assessment
FSLR has demonstrated moderate volatility over the past three months, slightly outperforming the market while experiencing a significant recent downturn in the past month. The stock maintains a high beta of 1.597, indicating it is substantially more volatile than the broader market.
Short-term Performance
FSLR declined sharply by 11.53% over the past month but posted a modest 3.01% gain over three months, marginally outperforming the market by 0.36%. This divergence suggests recent weakness after a period of relative strength, highlighting the stock's characteristic volatility given its high beta.
Current Position
Trading at $241.36, FSLR sits near the upper end of its 52-week range ($116.56 to $285.99), approximately 76% above its low. While not at overbought extremes, the current level is well above the midpoint of the range, indicating limited downside protection given the substantial 37.59% maximum drawdown experienced over the past year.
| Period | FSLR Return | S&P 500 |
|---|---|---|
| 1m | -7.2% | +1.3% |
| 3m | +4.7% | +5.7% |
| 6m | +42.5% | +10.6% |
| 1y | +26.6% | +16.5% |
| ytd | -13.8% | +1.1% |
FSLR Fundamental Analysis
FSLR demonstrates strong profitability with robust revenue growth, increasing from $1.1 billion in Q2 to $1.6 billion in Q3 2025. The company maintains healthy margins, with a net profit margin of 28.6% in Q3, though slightly lower than Q2's 31.2% due to increased costs. Operating income margin remains strong at 29.2%, indicating efficient core operations despite sequential compression.
Financially, FSLR exhibits excellent health with minimal leverage, reflected in a low debt ratio of 6.6% and debt-to-equity of just 9.9%. The company maintains strong liquidity with a current ratio of 1.91 and cash ratio of 0.64, while impressive interest coverage of 33x provides ample safety margin. Operating cash flow generation remains robust, supporting financial flexibility.
Operational efficiency shows mixed results, with ROE at 5.1% and ROA at 3.4%, indicating moderate capital utilization. Asset turnover of 0.12 suggests some inefficiency in revenue generation relative to asset base, though inventory turnover of 0.89 aligns with the manufacturing cycle. The 128-day sales outstanding period highlights extended receivables collection, presenting an opportunity for working capital optimization.
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Level: First Solar's current TTM PE of 18.22 appears reasonable, though it trades materially above its forward PE of 13.0, indicating strong expected earnings growth. The PEG ratio of 0.39 suggests significant undervaluation relative to its growth prospects. However, elevated ratios such as PS of 5.05 and notably high EV/EBITDA of 36.8 highlight a premium valuation that relies heavily on future performance metrics being achieved.
Peer Comparison: Due to the unavailability of industry average data, a definitive peer comparison cannot be established quantitatively. The valuation must therefore be assessed based on absolute metrics and forward-looking indicators like its low PEG ratio. Investors should seek specific industry benchmark data to contextualize whether these multiples represent a sector premium or are in line with solar energy peers.
Investment Risk Disclosure
Volatility Risk: FSLR exhibits high volatility risk, as evidenced by its Beta of 1.597, indicating it is approximately 60% more volatile than the broader market. This elevated sensitivity is compounded by a significant one-year maximum drawdown of -37.59%, highlighting considerable downside risk during adverse market conditions.
Other Risks: While the absence of short interest suggests a lack of significant bearish bets on the stock, which is a positive factor, other inherent risks remain. These include the company's exposure to fluctuating government energy policies, subsidies for solar power, and intense competition within the renewable energy sector, which can impact its operational stability and long-term profitability.
FAQs
Bullish
First Solar (FSLR) appears attractive for investors seeking exposure to the renewable energy sector, supported by strong financials and growth prospects. Key reasons include: 1) robust revenue growth rising to $1.6 billion in Q3 with healthy profit margins near 30%, 2) a compelling PEG ratio of 0.39 suggesting undervaluation relative to earnings growth potential, and 3) solid analyst confidence with a consensus "buy" rating. This stock suits long-term growth investors and those comfortable with volatility, given its high beta (1.6) and sensitivity to sector news.
Based on the provided data, First Solar (FSLR) appears undervalued.
The judgment is primarily driven by its compelling PEG ratio of 0.39, which signals undervaluation when a stock's Price/Earnings ratio is less than its growth rate. While the forward P/E of 13.0 is more attractive than the trailing P/E of 18.22, the high P/S ratio of 5.05 indicates the market is pricing in significant future revenue growth.
The primary reason for this valuation is the market's expectation of substantial earnings growth, as evidenced by the large gap between the trailing and forward P/E. The company's strong fundamentals—including robust profitability (28.6% net margin), minimal debt, and healthy cash flow—support this growth narrative, making the current price appear justified relative to its future potential.
Based on the provided information, here are the key risks of holding FSLR stock, ordered by importance:
1. Market Volatility Risk: The stock's high beta of 1.597 subjects it to significantly greater price swings than the broader market, exposing investors to substantial downside risk, as evidenced by its maximum one-year drawdown of -37.59%. 2. Policy and Subsidy Dependency Risk: The company's operational stability and profitability are vulnerable to fluctuations in government energy policies and subsidies for solar power, which are outside of its direct control. 3. Intense Competitive Pressure Risk: FSLR faces significant competition within the renewable energy sector, which can pressure margins, market share, and long-term profitability. 4. Operational Inefficiency Risk: An asset turnover of 0.12 and a 128-day sales outstanding period indicate potential inefficiencies in utilizing assets to generate revenue and in collecting receivables, which can impact cash flow and returns.
Of course. Here is a professional forecast for First Solar (FSLR) stock performance through 2026.
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FSLR Stock Forecast: 2024 - 2026
Based on a combination of strong fundamental tailwinds and significant industry-wide risks, here is a strategic outlook for First Solar.
1. Target Price Range (End of 2026): * Base Case: $290 - $350 * Bull Case: $400 - $500 (contingent on accelerated policy support and market share gains)
2. Key Growth Drivers: * The Inflation Reduction Act (IRA): The foundational U.S. policy providing massive manufacturing incentives and long-term tax credits, creating a significant cost advantage over foreign competitors. * Dominance in Utility-Scale Solar: FSLR is a leader in the large-scale solar project market, which is critical for grid decarbonization and offers multi-year revenue visibility through its module backlog. * Proprietary Thin-Film Technology: Their Series 7 modules are not subject to tariffs and offer a competitive edge in hot/humid climates, differentiating them from dominant crystalline silicon producers.
3. Main Assumptions: * The core provisions of the IRA remain intact through the 2026 timeframe. * Global demand for solar energy continues to grow at a CAGR of 15-20%. * First Solar successfully executes its capacity expansion plans without major delays or cost overruns. * Commodity and supply chain pressures do not escalate beyond current expectations.
4. Uncertainty & Risks: This forecast carries high uncertainty. The stock is highly sensitive to potential changes in U.S. energy policy, particularly around the IRA. Other key risks include intense competition from Chinese manufacturers, potential global oversupply of modules pressuring margins, and execution risks in ramping up new manufacturing facilities.
In summary, while First Solar is uniquely positioned to benefit from strong secular trends and supportive U.S. policy, making a strong bull case plausible, investors must be prepared for significant volatility driven by political and competitive dynamics.