$FSLR Due Diligence — First Solar Inc
Buy · 7/10 — full report on Stockato.
- Price: $208.86
- P/E: 13.26
- Market cap: $22.1B
- Revenue (TTM): $5.4B
- Profit margin: 31%
VERDICT: BUY
SCORE: 7/10
CONFIDENCE: MEDIUM — based on signal agreement
COMPANY OVERVIEW
First Solar Inc. designs and manufactures CdTe thin-film solar modules with a heavy U.S. manufacturing focus. It operates in the solar industry under the technology sector and reported $5.42B TTM revenue.
KEY FUNDAMENTALS
Revenue TTM $5.42B, gross margin ~42%, operating margin 33.1%, profit margin 30.7%, EPS $15.54, forward PE 12.58, EV/EBITDA 8.75. 52-week range $172–$321; current price 208.86 sits 35% below highs. Analyst consensus: 21 buy/strong-buy, 12 hold, 2 sell; average target $254.25 (+22% upside). Short interest 7.65% of shares, down 3.7% MoM.
BULL CASE
- Options flow shows $3.12M bullish premium (65%) vs $1.68M bearish across 30 alerts, led by a $2.22M sweep buy of Dec-2026 $220 calls.
- TD Cowen reiterated Buy/$253 citing Section 232 polysilicon probe and July 4 safe-harbor utility demand as ASP tailwinds.
- Q1 2026 earnings showed 65% YoY EPS growth and 23.6% revenue growth; U.S. module supply remains tight.
- Natural-gas storage exhaustion thesis by 2028–2030 supports higher power prices and solar+storage buildout.
BEAR CASE
- Price is 7.5% below 20-day SMA and 16% below 50-day SMA with RSI at 31.3 and negative MACD; volume 47% below average.
- Jefferies Hold/$207 note flags pre-secured U.S. modules and international underutilization, forecasting Q2 revenue $1.0B and EBITDA $465M below consensus.
- 8.1 GW of contract terminations YTD 2025 (including 6.6 GW BP) plus repeated guidance misses (FY24 EPS $12.02 vs $13–13.50 target).
- Management credibility 6.5/10; repeated “one-time” disruptions and policy-driven revisions.
OPTIONS POSITIONING
BULLISH_FLOW with 65% bullish premium ($3.12M calls vs $1.68M puts across 30 alerts, net +$1.44M directional). Top trades: $2222k BOUGHT CALL $220 2026-12-18 SWEEP; $479k SOLD PUT $165 2026-08-21; $278k SOLD CALL $212.5 2026-08-21 SWEEP; $218k SOLD CALL $220 2026-12-18 SWEEP; $207k SOLD CALL $220 2026-12-18. IV skew -3.37pp (calls richer). Flow supports the fundamental recovery thesis and is directional rather than hedge-shaped.
X / SOCIAL CHATTER
TD Cowen’s Section 232 and utility-demand catalyst view is the dominant bullish thread. Jefferies’ muted Q2 channel-check commentary provides the clearest near-term caution. Natural-gas shortage modeling (Matthew Smith) frames FSLR as a structural beneficiary post-2028. No credible contrarian posts surfaced in the last seven days.
MANAGEMENT CREDIBILITY
Score 6.5/10. Strong delivery on U.S. capacity and CdTe/CuRe milestones offset by repeated contract terminations, recurring “one-time” operational hits, and multiple guidance misses (FY24 EPS $12.02 vs repeated $13–13.50 targets). Excuses center on macro/policy factors.
KEY CATALYSTS
Q2 earnings (expected early August); Section 232 polysilicon investigation outcome; July 4 safe-harbor demand pull-forward.
KEY RISKS
Further contract terminations, international utilization below 70%, and tariff/policy reversal.
BOTTOM LINE
FSLR trades at 12.6x forward earnings with 22% analyst upside and bullish options flow while sitting 35% off highs; the setup favors a tactical long into earnings despite technical weakness and mixed guidance history.
How FSLR trades
43% below its 52-week high; worst drawdown in the past year 46%.
Moved 7.0% on average (absolute) across the last 8 earnings reports.
Behind SPY by 24.2 pts over 3 months.
Trades as a market-like name: β 1.2 to QQQ, 4.2× SPY's volatility.
Realized volatility is 56% over 20 days, in line with its 1-year 55%.
One-year beta: 1.83 to SPY, 1.21 to QQQ (data-vendor beta 1.79).
Correlation of daily returns: SPY 0.54 (60 days) / 0.43 (1 year); QQQ 0.47 (60 days) / 0.44 (1 year); IWM 0.47 (60 days) / 0.43 (1 year); XLE -0.16 (60 days) / -0.06 (1 year); 10y yield (daily change) -0.38 (60 days) / -0.19 (1 year).
Realized volatility: 56% (20 days), 51% (60 days), 55% (1 year).
Maximum drawdown over the past year -46%; -43% from the 52-week high.
FSLR options and volatility
25-delta puts trade 6.7 vol points below calls in the nearest monthly expiry.
ATM implied vol runs 70% at 1 day to 54% at 162 days (event kink at earnings).
Options price 0.89× the last 20 days' realized volatility.
The first expiry after earnings (2026-10-30, 22 days out) prices ±10.8%, which also covers 22 days of ordinary movement; the average move on earnings day itself has been 7.0%.
Dealers are short gamma; call wall 185.0, put wall 180.0.
Options-implied expected moves: this week (2026-10-09): ±$5.29 (±2.93%); next monthly (2026-10-16): ±$10.55 (±5.86%); earnings expiry (2026-10-30): ±$19.48 (±10.82%).
Options data as of 2026-10-08 07:14 UTC.