Wall Street is increasingly bullish on the broader artificial intelligence energy trade spanning nuclear, natural gas, grid expansion, battery storage, and solar, as the AI arms race sends energy demand soaring.

Yet, the solar energy industry has been largely left behind in the AI energy trade that’s sent speculative pre-revenue companies like Oklo and giants such as GE Vernova and Constellation skyrocketing over the last few years.

First Solar (FSLR Quick QuoteFSLR - Free Report)  is a Zacks Rank #2 (Buy) stock that’s bucked the solar industry trend. The largest U.S. solar manufacturer is an AI energy stock investors should consider buying in October for long-term upside.

The stock has surged 80% in the past six months as part of FSLR’s 350% climb over the last decade, crushing its industry’s 35% and the S&P 500’s 250%. Yet the largest U.S. solar manufacturer trades 24% below its 2024 highs and at a 90% discount to its peak valuation.

First Solar is set to post huge earnings and revenue growth in 2025 and 2026. It also confirmed its bullish outlook in late July, noting the One Big Beautiful Bill maintained most of the critical tax credits for domestic solar.

Solar Energy’s Simple AI Bull Case

Generative AI platforms like ChatGPT use 10X the energy of an average Google search, while large data centers consume as much electricity as a mid-sized city.

AI growth, alongside reshoring and the energy transition, is expected to drive a 25% increase in U.S. electricity demand by 2030 and a 75% increase by 2050.

Image Source: U.S. Energy Information Administration (EIA)

Wall Street knows that an AI-boosted economy won’t be possible without a lot more energy. AI hyperscalers are racing to secure deals with nuclear energy firms. But next-gen nuclear plants aren’t even set to begin construction until the end of this decade at the earliest.

The U.S. does not have that long to wait, and neither do the hyperscalers, providing a ton of runway for utility-scale solar. Amazon, Microsoft, and other AI hyperscalers have committed to large-scale solar projects in 2025.

Solar is set to account for over 50% of new U.S. utility-scale electricity-generating capacity in 2025, crushing battery storage at 29%, wind at 12%, and natural gas at 7%, based on U.S. Energy Information Administration data. This near-term outlook extends a longer-term uptrend for solar that began around 2010.

Solar stocks soared between 2017 and the end of 2020. Higher interest rates, hard to compete against periods of growth, and other headwinds crushed solar energy stocks over the last several years.

Image Source: U.S. Energy Information Administration (EIA)

The additional setbacks include the flood of Chinese-made solar panels and the possibility that favorable tax incentives will disappear. All of this is why the Zacks Solar industry is down 50% in the past three years vs. the S&P 500’s 90% gain.

That said, the slow phaseout of some subsidies will encourage cost-saving measures and simplify the investment opportunity for a larger swath of big money.

The companies that survive the gauntlets ahead will come out stronger because solar is still set to play a large role in electricity capacity growth, especially in the near term, as the country races to bring more power online as fast as possible. Plus, Solar is now in the top 19% of over 240 Zacks industries.

Is First Solar the Next Great AI Energy Stock?

First Solar is making its case as the standout solar energy stock for bullish AI energy investors to buy. FSLR has climbed 75% in the past three years as Wall Street gravitates toward many of its best-in-class offerings.

First Solar is the largest U.S. solar manufacturer prepared to grow as the U.S. aims to help boost domestic production and fight back against China’s dominance.

The company is already “unique among the world’s ten largest solar manufacturers for being the only U.S.-headquartered company and not manufacturing in China.”

Image Source: Zacks Investment Research

The company is expanding its domestic manufacturing footprint in Alabama and Louisiana. FSLR’s buildout is supported by an impressive balance sheet of $12.9 billion in assets vs. $4.3 billion in liabilities.

The Arizona-based firm said in its Q2 report in late July that its utility-scale solar offerings are ready to thrive as part of “America’s all-of-the-above power generation strategy.”

Despite broader fears about reduced support for solar under the One Big Beautiful Bill and the Trump administration, FSLR confirmed its bullish outlook last quarter while also noting that the OBBB maintained most of the critical Section 45X tax credits for domestic solar.

Image Source: Zacks Investment Research

The solar energy company said its total bookings backlog hit 64 GW last quarter, and extends through 2030. First Solar is projected to grow its revenue by 28% in FY25 and 15% in FY26 to hit $6.16 billion, up from $4.21 billion in 2024.

FSLR is to expand its adjusted earnings per share (EPS) by 26% in 2025 and 49% in 2026 to soar from $12.02 in FY24 to $22.52 per share next year. FSLR’s upbeat earnings outlook helps it earn a Zacks Rank #2 (Buy), and it topped our estimate by 19% last quarter.

Image Source: Zacks Investment Research

Buy FSLR for Impressive Value and Breakout Potential

FSLR surged 350% in the last decade, crushing its industry’s 35% and the S&P 500’s 250%. More recently, the stock has climbed 75% in the past three years while its industry tanked 50%.

The stock has charged 80% higher in the past six months to help it trade near 52-week highs. First Solar is also on the verge of a breakout if it’s able to move above the technical level highlighted below.

Image Source: Zacks Investment Research

First Solar stock trades roughly 24% below its 2024 highs (which were near its 2008 peaks). Better yet, it trades at a 45% discount to its median, 90% below its highs, and 55% below the S&P 500 at 10.7X forward 12-month earnings.

FSLR is one of the more compelling value plays across the broader AI energy trade. Therefore, it’s not surprising that 24 of the 32 brokerage recommendations Zacks has are “Strong Buys.”