Latest news with #MarkWidmar
Globe and Mail
01-05-2025
- Business
- Globe and Mail
First Solar Stock Just Got Its First 'Sell' Rating After Earnings. Here's Why.
As tariff tensions escalate, one stock has emerged as the lone bright spot in the solar sector. With the U.S. slapping a jaw-dropping 3,521% duty on select solar goods from Cambodia - the steepest penalty following a probe into four Southeast Asian nations - Arizona-based First Solar, Inc. (FSLR) had appeared to be a clear winner. While Malaysia got off relatively lightly with sub-35% tariffs, the overall clampdown targets $11.9 billion worth of 2023 shipments that once formed the backbone of U.S. solar imports. The sharp turn of events stems from claims that Chinese companies, operating out of Southeast Asia, benefited from subsidies that crushed American manufacturing. First Solar, which brought the case last year, now finds itself in the spotlight. Its stock surged 10.5% on April 22 following the news. With U.S. warehouses already stocked and Chinese players pivoting to countries like Indonesia and Laos, why did U.S.-based FSLR get slapped with a new 'Sell' rating after earnings today? About First Solar Stock First Solar, Inc. (FSLR) has long stood as a pillar of American innovation in the solar industry. Headquartered in Tempe, Arizona, this $13.49 billion company is the only U.S.-based name among the world's solar giants. Specializing in photovoltaic solar modules made with advanced thin-film semiconductor technology, FSLR offers a greener, lower-carbon alternative to traditional crystalline silicon panels. First Solar has underperformed in 2025, with the stock tumbling 28.09% year-to-date. However, the stock is slightly higher today - even after the company missed on earnings, and offered bleak guidance - amid widespread buying on Wall Street. Valuation-wise, the stock is currently trading at 8.27 times forward adjusted earnings, representing a significant discount to both its industry counterparts and its own five-year average. Moreover, FSLR's historically discounted 2.39 price/sales ratio underscores the headwinds that the solar specialist has been facing in a high interest-rate market. A Closer Look at First Solar's Q1 Earnings FSLR is trading higher today despite reporting Q1 earnings that fell short of expectations. The company reported first-quarter net income of $209.5 million, or $1.95 per share, against expectations for $2.50 per share. Revenue of $844.6 million also fell short of the $850.8 consensus on Wall Street. For the full fiscal year, First Solar expects to earn $12.50 and $17.50 per share, with revenue projected anywhere between $4.5 billion to $5.5 billion. That's a wide range, and a considerable reduction from management's previous guidance, which called for EPS of $17 to $20 and revenue of $5.3 billion to $5.8 billion for fiscal 2025. How Tariffs Are Impacting First Solar The top range of FSLR's guidance is baking in the expectation that 10% tariffs will remain in place through 2025, while the lower range accounts for a broader range of potential outcomes. While First Solar may be based out of Arizona, CEO Mark Widmar cited a "significant economic headwind for our manufacturing facilities in [India, Malaysia, and Vietnam] selling into the U.S. market" due to the implementation of reciprocal tariffs. 'There's a lot of strategies that we could do once we understand the policy environment and the tariff environment that we're going to be in, but I don't know any of that right now,' added Widmar later in the call. 'So, our guide is taking the limited information that we have, applying that and it does reflect a meaningful reduction to volume in the low end for sure. Top end, it's relatively small 700 megawatts.' What Do Analysts Expect for First Solar Stock? FSLR stock was hit with multiple downgrades today following its soft guidance, as experts at Oppenheimer, KeyBanc, and Jefferies all lowered their ratings. In a note to clients, KeyBanc analyst Sophie Karp cut FSLR all the way to 'Underweight' - a rare bearish note for the 'Strong Buy'-rated stock. Karp has a $100 price target on First Solar, marking a new Street-low forecast.
Yahoo
30-04-2025
- Business
- Yahoo
FSLR Q1 Earnings Call: Tariffs and Policy Uncertainty Drive Down Guidance, Margins Under Pressure
Solar panel manufacturer First Solar (NASDAQ:FSLR) met Wall Street's revenue expectations in Q1 CY2025, with sales up 6.4% year on year to $844.6 million. On the other hand, the company's full-year revenue guidance of $5 billion at the midpoint came in 8.7% below analysts' estimates. Its GAAP profit of $1.95 per share was 22.1% below analysts' consensus estimates. Is now the time to buy FSLR? Find out in our full research report (it's free). Revenue: $844.6 million vs analyst estimates of $847.9 million (6.4% year-on-year growth, in line) EPS (GAAP): $1.95 vs analyst expectations of $2.50 (22.1% miss) Adjusted EBITDA: $45.3 million vs analyst estimates of $380.6 million (5.4% margin, 88.1% miss) The company dropped its revenue guidance for the full year to $5 billion at the midpoint from $5.55 billion, a 9.9% decrease EPS (GAAP) guidance for the full year is $15 at the midpoint, missing analyst estimates by 16.9% Operating Margin: 26.2%, down from 30.6% in the same quarter last year Free Cash Flow was -$813.9 million compared to -$145.7 million in the same quarter last year Market Capitalization: $14.72 billion First Solar's first quarter results reflected operational headwinds tied to shifting geographic sales mix and ongoing industry policy changes. Management attributed the quarter's profit shortfall to a larger portion of module sales coming from international facilities, while U.S. production volumes lagged internal forecasts due to manufacturing and shipment timing issues. CEO Mark Widmar acknowledged that the company's ability to mitigate these challenges was constrained by continued policy uncertainty around tariffs and clean energy tax credits. Looking ahead, management's revised full-year guidance sharply lowered both sales and profit expectations, citing the evolving U.S. tariff landscape and its ripple effects on customer demand and production allocations. Widmar characterized the current environment as highly unpredictable, noting that future decisions on production, contract fulfillment, and capital allocation will depend on the final structure of tariffs and the fate of key U.S. clean energy incentives. As a result, the company is prioritizing operational flexibility and ongoing dialogue with customers to navigate these uncertainties. First Solar's management spent the earnings call detailing how shifting trade policy and tariff regimes have created significant uncertainty for both operations and customer demand. The company emphasized its efforts to adapt production plans and manage contract risks while continuing to invest in domestic manufacturing. Tariff impact on operations: Management explained that the imposition of new U.S. tariffs on solar modules from India, Malaysia, and Vietnam has made it uneconomical to sell products from these factories into the U.S. market if higher rates are reinstated. The company is considering temporarily idling or repurposing these facilities depending on future tariff decisions. Contractual protections: A significant portion of First Solar's backlog includes clauses that allow contracts to be terminated or renegotiated if tariffs make fulfillment uneconomical. This provides some protection, but also introduces uncertainty about the ultimate conversion of backlog to revenue. Domestic manufacturing expansion: The ramp-up of new factories in Alabama and Louisiana continues, with management reaffirming plans to expand U.S. nameplate capacity to over 14 gigawatts by 2026. These expansions are designed to capitalize on incentives for domestic content and to insulate the company from tariff risks. Product technology advances: The company completed a limited production run of modules using its CuRe technology, which management claims are demonstrating improved energy output and lower degradation rates in initial tests. These modules are being deployed in commercial and field test sites, and further adoption depends on ongoing validation. Customer dynamics amid policy shifts: Management noted increased customer engagement as buyers look to de-risk exposure to tariffs and secure domestic supply. However, uncertainty around future tariffs and the status of U.S. tax credits has delayed finalizing many new contracts and bookings. Management's outlook for the year is shaped by the interplay of tariff policy, clean energy incentives, and supply chain flexibility, all of which are expected to impact production volumes, pricing, and margins in the coming quarters. Tariff regime uncertainty: The future profitability and utilization of First Solar's international plants hinge on whether temporary universal tariffs remain in place or higher, country-specific rates are imposed. Management is maintaining flexibility, including the possibility of idling plants or shifting production toward domestic markets like India. U.S. policy and tax credits: The fate of the Inflation Reduction Act's manufacturing and investment tax credits will directly influence First Solar's domestic expansion plans and the economics of supplying U.S. customers. Management is closely watching legislative developments and advocating for provisions that favor U.S.-sourced modules. Customer contract negotiations: Pending decisions on tariff cost-sharing and contract renegotiations could affect backlog conversion, shipment timing, and pricing. Management indicated that much of the company's forward visibility depends on the outcome of ongoing discussions with customers. Philip Shen (ROTH Capital Partners): Asked how tariffs are affecting new bookings and whether uncertainty is causing customers to delay or cancel orders. Management said customer engagement has increased as buyers seek to secure domestic supply, but uncertainty has slowed contract finalizations. Andrew Percoco (Morgan Stanley): Questioned the extent to which guidance reductions were driven by battery storage supply chain issues versus broader demand. Management responded that the main driver was tariffs making international production uneconomical, not underlying demand. Kashy Harrison (Piper Sandler): Inquired about strategic options for international assets if tariffs remain high, including relocating equipment or repurposing facilities. Management said options depend on future policy, including potentially moving equipment to the U.S. or establishing finishing lines domestically. Brian Lee (Goldman Sachs): Asked about the willingness to accept lower margins versus passing tariffs on to customers and the timeline for expanding U.S. finishing capacity. Management said current guidance assumes absorbing tariff costs, but future contracts may share these costs, and that setting up new finishing lines could take 9–12 months if warranted. Julien Dumoulin-Smith (Jefferies): Sought clarity on repricing risk for the company's backlog if tariffs remain elevated. Management stated that most backlog is insulated from repricing except for about 12 gigawatts tied to international production, with outcomes depending on customer negotiations and possible facility changes. In upcoming quarters, the StockStory team will monitor (1) final decisions on U.S. tariff structures and whether reciprocal tariffs are reinstated or replaced, (2) legislative progress on clean energy tax credits and their impact on First Solar's domestic expansion plans, and (3) the pace of contract renegotiations for international backlog volumes. Additionally, the ramp-up of new U.S. manufacturing facilities and adoption of the company's CuRe technology will be important indicators of execution. First Solar currently trades at a forward P/E ratio of 6.2×. At this valuation, is it a buy or sell post earnings? The answer lies in our free research report. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Comfort Systems (+751% five-year return). Find your next big winner with StockStory today. Sign in to access your portfolio
Time of India
30-04-2025
- Business
- Time of India
First Solar lowers annual sales and profit forecast on near-term tariff troubles
First Solar lowered its annual sales and profit forecast on Tuesday due to near-term tariff-related challenges amid the ongoing U.S.-China trade war and tepid residential demand in the United States, sending its shares down 11 per cent in after-hours trading. U.S. residential solar demand has remained weak due to high interest rates and metering reforms in top market California, which have reduced the credits customers receive for feeding excess electricity back into the grid. Earlier this month, U.S. trade officials finalized steep tariff levels on most solar cells imported from Southeast Asia, after American manufacturers complained that companies from the region were flooding the market with unfairly cheap goods. Despite additional tariffs on foreign-made products, module prices in the United States have not increased as expected because of a surge in solar imports in 2023 has resulted in high inventory levels. "Despite the near-term challenges presented by the new tariff regime, we believe that the long-term outlook for solar demand, particularly in our core U.S. market, remains strong, and that First Solar remains well-positioned to serve this demand," said CEO Mark Widmar. The company expects current-year net sales to be between $4.5 billion and $5.5 billion, compared to its previous projection of $5.3 billion to $5.8 billion. The solar company forecast 2025 earnings in the range of $12.50 per share to $17.50 per share, compared with its earlier forecast of a profit between $17.00 per share and $20.00 per share. The company reported a net income of $209.5 million for the quarter ended March 31, down about 11.4 per cent from last year. First Solar reported net sales of $844.6 million for the first quarter, marking an increase of 6.4 per cent compared to the same period last year.
Yahoo
29-04-2025
- Business
- Yahoo
First Solar (NASDAQ:FSLR) Posts Q1 Sales In Line With Estimates But Stock Drops
Solar panel manufacturer First Solar (NASDAQ:FSLR) met Wall Street's revenue expectations in Q1 CY2025, with sales up 6.4% year on year to $844.6 million. On the other hand, the company's full-year revenue guidance of $5 billion at the midpoint came in 8.9% below analysts' estimates. Its GAAP profit of $1.95 per share was 22.1% below analysts' consensus estimates. Is now the time to buy First Solar? Find out in our full research report. Revenue: $844.6 million vs analyst estimates of $847.9 million (6.4% year-on-year growth, in line) EPS (GAAP): $1.95 vs analyst expectations of $2.50 (22.1% miss) Adjusted EBITDA: $349.7 million vs analyst estimates of $380.6 million (41.4% margin, 8.1% miss) The company dropped its revenue guidance for the full year to $5 billion at the midpoint from $5.55 billion, a 9.9% decrease EPS (GAAP) guidance for the full year is $15 at the midpoint, missing analyst estimates by 17.1% Operating Margin: 26.2%, down from 30.6% in the same quarter last year Free Cash Flow was -$813.9 million compared to -$145.7 million in the same quarter last year Market Capitalization: $15.09 billion 'Despite the near-term challenges presented by the new tariff regime, we believe that the long-term outlook for solar demand, particularly in our core U.S. market, remains strong, and that First Solar remains well-positioned to serve this demand,' said Mark Widmar, Chief Executive Officer. Headquartered in Arizona, First Solar (NASDAQ:FSLR) specializes in manufacturing solar panels and providing photovoltaic solar energy solutions. Reviewing a company's long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Over the last five years, First Solar grew its sales at a mediocre 6.8% compounded annual growth rate. This wasn't a great result compared to the rest of the industrials sector, but there are still things to like about First Solar. We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. First Solar's annualized revenue growth of 23.3% over the last two years is above its five-year trend, suggesting its demand recently accelerated. First Solar's recent performance shows it's one of the better Renewable Energy businesses as many of its peers faced declining sales because of cyclical headwinds. This quarter, First Solar grew its revenue by 6.4% year on year, and its $844.6 million of revenue was in line with Wall Street's estimates. Looking ahead, sell-side analysts expect revenue to grow 41.1% over the next 12 months, an improvement versus the last two years. This projection is eye-popping and suggests its newer products and services will fuel better top-line performance. Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we've identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link. Operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses – everything from the cost of goods sold to advertising and wages. It's also useful for comparing profitability across companies with different levels of debt and tax rates because it excludes interest and taxes. First Solar has been a well-oiled machine over the last five years. It demonstrated elite profitability for an industrials business, boasting an average operating margin of 20.8%. Analyzing the trend in its profitability, First Solar's operating margin rose by 13.2 percentage points over the last five years, as its sales growth gave it operating leverage. This quarter, First Solar generated an operating profit margin of 26.2%, down 4.4 percentage points year on year. Since First Solar's operating margin decreased more than its gross margin, we can assume it was less efficient because expenses such as marketing, R&D, and administrative overhead increased. We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company's growth is profitable. First Solar's EPS grew at an astounding 96% compounded annual growth rate over the last five years, higher than its 6.8% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded. Diving into First Solar's quality of earnings can give us a better understanding of its performance. As we mentioned earlier, First Solar's operating margin declined this quarter but expanded by 13.2 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its higher earnings; taxes and interest expenses can also affect EPS but don't tell us as much about a company's fundamentals. Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business. For First Solar, its two-year annual EPS growth of 449% was higher than its five-year trend. We love it when earnings growth accelerates, especially when it accelerates off an already high base. In Q1, First Solar reported EPS at $1.95, down from $2.20 in the same quarter last year. This print missed analysts' estimates, but we care more about long-term EPS growth than short-term movements. Over the next 12 months, Wall Street expects First Solar's full-year EPS of $11.76 to grow 77.1%. We struggled to find many positives in these results. Despite in-line revenue, adjusted EBITDA and EPS in the quarter fell short, showing that profitability was worse than expected. The company's full-year revenue guidance missed significantly and its full-year EPS guidance also fell short of Wall Street's estimates as well. Overall, this was a softer quarter. The stock traded down 10% to $123.50 immediately after reporting. First Solar's earnings report left more to be desired. Let's look forward to see if this quarter has created an opportunity to buy the stock. We think that the latest quarter is just one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it's free. Sign in to access your portfolio
Yahoo
29-04-2025
- Business
- Yahoo
First Solar (NASDAQ:FSLR) Posts Q1 Sales In Line With Estimates But Stock Drops
Solar panel manufacturer First Solar (NASDAQ:FSLR) met Wall Street's revenue expectations in Q1 CY2025, with sales up 6.4% year on year to $844.6 million. On the other hand, the company's full-year revenue guidance of $5 billion at the midpoint came in 8.9% below analysts' estimates. Its GAAP profit of $1.95 per share was 22.1% below analysts' consensus estimates. Is now the time to buy First Solar? Find out in our full research report. Revenue: $844.6 million vs analyst estimates of $847.9 million (6.4% year-on-year growth, in line) EPS (GAAP): $1.95 vs analyst expectations of $2.50 (22.1% miss) Adjusted EBITDA: $349.7 million vs analyst estimates of $380.6 million (41.4% margin, 8.1% miss) The company dropped its revenue guidance for the full year to $5 billion at the midpoint from $5.55 billion, a 9.9% decrease EPS (GAAP) guidance for the full year is $15 at the midpoint, missing analyst estimates by 17.1% Operating Margin: 26.2%, down from 30.6% in the same quarter last year Free Cash Flow was -$813.9 million compared to -$145.7 million in the same quarter last year Market Capitalization: $15.09 billion 'Despite the near-term challenges presented by the new tariff regime, we believe that the long-term outlook for solar demand, particularly in our core U.S. market, remains strong, and that First Solar remains well-positioned to serve this demand,' said Mark Widmar, Chief Executive Officer. Headquartered in Arizona, First Solar (NASDAQ:FSLR) specializes in manufacturing solar panels and providing photovoltaic solar energy solutions. Reviewing a company's long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Over the last five years, First Solar grew its sales at a mediocre 6.8% compounded annual growth rate. This wasn't a great result compared to the rest of the industrials sector, but there are still things to like about First Solar. We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. First Solar's annualized revenue growth of 23.3% over the last two years is above its five-year trend, suggesting its demand recently accelerated. First Solar's recent performance shows it's one of the better Renewable Energy businesses as many of its peers faced declining sales because of cyclical headwinds. This quarter, First Solar grew its revenue by 6.4% year on year, and its $844.6 million of revenue was in line with Wall Street's estimates. Looking ahead, sell-side analysts expect revenue to grow 41.1% over the next 12 months, an improvement versus the last two years. This projection is eye-popping and suggests its newer products and services will fuel better top-line performance. Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we've identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link. Operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses – everything from the cost of goods sold to advertising and wages. It's also useful for comparing profitability across companies with different levels of debt and tax rates because it excludes interest and taxes. First Solar has been a well-oiled machine over the last five years. It demonstrated elite profitability for an industrials business, boasting an average operating margin of 20.8%. Analyzing the trend in its profitability, First Solar's operating margin rose by 13.2 percentage points over the last five years, as its sales growth gave it operating leverage. This quarter, First Solar generated an operating profit margin of 26.2%, down 4.4 percentage points year on year. Since First Solar's operating margin decreased more than its gross margin, we can assume it was less efficient because expenses such as marketing, R&D, and administrative overhead increased. We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company's growth is profitable. First Solar's EPS grew at an astounding 96% compounded annual growth rate over the last five years, higher than its 6.8% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded. Diving into First Solar's quality of earnings can give us a better understanding of its performance. As we mentioned earlier, First Solar's operating margin declined this quarter but expanded by 13.2 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its higher earnings; taxes and interest expenses can also affect EPS but don't tell us as much about a company's fundamentals. Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business. For First Solar, its two-year annual EPS growth of 449% was higher than its five-year trend. We love it when earnings growth accelerates, especially when it accelerates off an already high base. In Q1, First Solar reported EPS at $1.95, down from $2.20 in the same quarter last year. This print missed analysts' estimates, but we care more about long-term EPS growth than short-term movements. Over the next 12 months, Wall Street expects First Solar's full-year EPS of $11.76 to grow 77.1%. We struggled to find many positives in these results. Despite in-line revenue, adjusted EBITDA and EPS in the quarter fell short, showing that profitability was worse than expected. The company's full-year revenue guidance missed significantly and its full-year EPS guidance also fell short of Wall Street's estimates as well. Overall, this was a softer quarter. The stock traded down 10% to $123.50 immediately after reporting. First Solar's earnings report left more to be desired. Let's look forward to see if this quarter has created an opportunity to buy the stock. We think that the latest quarter is just one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it's free.
