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FSLR Outperforms Market Over the Past Month: How to Play the Stock?
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Key Takeaways
First Solar shares rose 6.5% in a month, beating the market and Oil-Energy sector gains.
FSLR beat Q2 estimates with $3.18 EPS and $1.10B revenues, raising 2025 sales outlook.
Company targets 25 GW capacity by 2026 and holds $18.5B in contracts through 2030.
Shares of First Solar Inc. (FSLR - Free Report) have gained 3.6% in the past month, outperforming the S&P 500’s growth of 2.3% and the broader Zacks Oil-Energy sector’s increase of 2.8%. However, it lagged the Zacks solar industry’s growth of 15.4% in the said time frame.
Image Source: Zacks Investment Research
Other prominent solar stocks, such as SolarEdge Technologies (SEDG - Free Report) and Array Technologies (ARRY - Free Report) , also delivered stellar performances on the bourses, as evident from their one-month price gain of 32% and 50.1%, respectively.
With FSLR’s robust performance on the bourses, some investors may consider buying this stock right away. However, before taking a strategic step like investing, one should carefully evaluate the stock’s long-term viability—does the company possess the underlying strengths to sustain its growth, or is the recent price surge just a fluke? It is important to assess the durability of its growth prospects and consider any risks associated with investing in FSLR to make a well-informed decision.
What Pushed Up FSLR Stock?
FSLR’s latest robust performance on the bourses seems to have been influenced by its strong second-quarter 2025 results.
First Solar reported second-quarter earnings of $3.18 per share, which surpassed the Zacks Consensus Estimate of $2.68 by 18.7%. The company’s net sales of $1.10 billion also beat the consensus estimate by 6.6% and improved 8.6% year over year.
Moreover, the company hiked its sales guidance for 2025. It now expects sales in the range of $4.90-$5.70 billion, higher than its earlier guided range of $4.50-$5.50 billion. This upward revision in guidance underscores management’s strong confidence in First Solar’s ability to deliver solid performance throughout the remaining quarters of 2025, which, in turn, must have also boosted investors’ optimism for the stock.
Can FSLR Hold Onto Its Winning Streak?
First Solar is steadily ramping up its production to meet the rising global solar energy demand. Notably, in the second quarter of 2025, the company produced 4.2 gigawatts (GW) of solar modules and aims to exceed 25 GW of annual manufacturing capacity by the end of 2026.
To this end, the company expects to spend $1.0-$1.5 billion in 2025 on new plants, expanding existing sites and upgrading equipment. This investment should support FSLR to duly achieve its expected module shipments of 16.7-19.3 GW by the end of 2025, which reflect an increase from its earlier guidance of 15.5-19.3 GW.
As of June 30, 2025, First Solar had signed contracts for 61.9 GW of future module sales, which is expected to fetch it revenues worth $18.5 billion through 2030.
All the aforementioned factors thus provide First Solar with strong long-term growth visibility, supported by a growing manufacturing base, expanding order backlog and substantial investments that position it to capitalize on global renewable energy trends for years to come.
In line with this, the Zacks Consensus Estimate for FSLR’s long-term (three to five years) earnings growth rate is pegged at 33.4%, which is better than its industry’s 22.9%.
Now let’s take a quick look at FSLR’s near-term earnings and sales estimates to check if these reflect similar improvement trends.
Estimates for FSLR Stock
The Zacks Consensus Estimate for third-quarter 2025 revenues and earnings indicates an improvement of 74.2% and 47.4%, respectively, from the prior-year level.
The annual estimate figures for FSLR’s sales and earnings also indicate solid improvement trends.
Image Source: Zacks Investment Research
Further, the upward revision in its near-term earnings estimate over the past 60 days suggests investors’ increasing confidence in this stock’s earnings generation capabilities.
Image Source: Zacks Investment Research
FSLR Stock Trading at a Premium
In terms of valuation, FSLR’s forward 12-month price-to-sales (P/S) is 3.54X, a premium to its industry’s average of 1.23X. This suggests that investors may be paying a higher price than the company's expected sales growth compared with that of its industry.
Image Source: Zacks Investment Research
ARRY is trading at a discount to the industry, at a forward 12-month P/S of 1.02X. SEDG is trading at a forward 12-month P/S of 1.50X.
Risks to Invest in FSLR Stock
One major challenge for First Solar is the oversupply of solar modules from China. In 2024, solar module manufacturers, mainly based in China, added about 270 GW of new production capacity. This rapid expansion created an imbalance between supply and demand, leading to price volatility. If competitors continue to lower prices to very low levels or operate with minimal or negative margins for extended periods, it could weigh on First Solar’s sales, profitability and overall performance.
Another risk arises from new U.S. legislation passed in July 2025, known as the One Big Beautiful Bill Act. This law reduced the Investment Tax Credit for residential solar and storage systems purchased with cash or loans, with the credit set to expire by the end of 2025. It also phased down tax credits for storage projects starting in 2034, increased domestic content requirements and set stricter rules on foreign content. These changes may reduce customer demand, raise compliance costs and limit First Solar’s ability to qualify for future incentives, which could hurt its revenues and long-term growth outlook.
Conclusion
First Solar has delivered strong results and enjoys solid growth prospects backed by its expanding manufacturing capacity, long-term sales contracts and improving earnings outlook.
However, considering its premium valuation and the risks tied to oversupply from China, changing tariff policies and the recent reduction in clean energy tax credits in the United States, new investors may prefer to wait for a more favorable entry point.
Existing shareholders, however, can remain invested in this Zacks Rank #3 (Hold) stock given the company’s strong order pipeline, solid performance at the bourses and long-term growth potential. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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FSLR Outperforms Market Over the Past Month: How to Play the Stock?
Key Takeaways
Shares of First Solar Inc. (FSLR - Free Report) have gained 3.6% in the past month, outperforming the S&P 500’s growth of 2.3% and the broader Zacks Oil-Energy sector’s increase of 2.8%. However, it lagged the Zacks solar industry’s growth of 15.4% in the said time frame.
Image Source: Zacks Investment Research
Other prominent solar stocks, such as SolarEdge Technologies (SEDG - Free Report) and Array Technologies (ARRY - Free Report) , also delivered stellar performances on the bourses, as evident from their one-month price gain of 32% and 50.1%, respectively.
With FSLR’s robust performance on the bourses, some investors may consider buying this stock right away. However, before taking a strategic step like investing, one should carefully evaluate the stock’s long-term viability—does the company possess the underlying strengths to sustain its growth, or is the recent price surge just a fluke? It is important to assess the durability of its growth prospects and consider any risks associated with investing in FSLR to make a well-informed decision.
What Pushed Up FSLR Stock?
FSLR’s latest robust performance on the bourses seems to have been influenced by its strong second-quarter 2025 results.
First Solar reported second-quarter earnings of $3.18 per share, which surpassed the Zacks Consensus Estimate of $2.68 by 18.7%. The company’s net sales of $1.10 billion also beat the consensus estimate by 6.6% and improved 8.6% year over year.
Moreover, the company hiked its sales guidance for 2025. It now expects sales in the range of $4.90-$5.70 billion, higher than its earlier guided range of $4.50-$5.50 billion. This upward revision in guidance underscores management’s strong confidence in First Solar’s ability to deliver solid performance throughout the remaining quarters of 2025, which, in turn, must have also boosted investors’ optimism for the stock.
Can FSLR Hold Onto Its Winning Streak?
First Solar is steadily ramping up its production to meet the rising global solar energy demand. Notably, in the second quarter of 2025, the company produced 4.2 gigawatts (GW) of solar modules and aims to exceed 25 GW of annual manufacturing capacity by the end of 2026.
To this end, the company expects to spend $1.0-$1.5 billion in 2025 on new plants, expanding existing sites and upgrading equipment. This investment should support FSLR to duly achieve its expected module shipments of 16.7-19.3 GW by the end of 2025, which reflect an increase from its earlier guidance of 15.5-19.3 GW.
As of June 30, 2025, First Solar had signed contracts for 61.9 GW of future module sales, which is expected to fetch it revenues worth $18.5 billion through 2030.
All the aforementioned factors thus provide First Solar with strong long-term growth visibility, supported by a growing manufacturing base, expanding order backlog and substantial investments that position it to capitalize on global renewable energy trends for years to come.
In line with this, the Zacks Consensus Estimate for FSLR’s long-term (three to five years) earnings growth rate is pegged at 33.4%, which is better than its industry’s 22.9%.
Now let’s take a quick look at FSLR’s near-term earnings and sales estimates to check if these reflect similar improvement trends.
Estimates for FSLR Stock
The Zacks Consensus Estimate for third-quarter 2025 revenues and earnings indicates an improvement of 74.2% and 47.4%, respectively, from the prior-year level.
The annual estimate figures for FSLR’s sales and earnings also indicate solid improvement trends.
Image Source: Zacks Investment Research
Further, the upward revision in its near-term earnings estimate over the past 60 days suggests investors’ increasing confidence in this stock’s earnings generation capabilities.
Image Source: Zacks Investment Research
FSLR Stock Trading at a Premium
In terms of valuation, FSLR’s forward 12-month price-to-sales (P/S) is 3.54X, a premium to its industry’s average of 1.23X. This suggests that investors may be paying a higher price than the company's expected sales growth compared with that of its industry.
Image Source: Zacks Investment Research
ARRY is trading at a discount to the industry, at a forward 12-month P/S of 1.02X. SEDG is trading at a forward 12-month P/S of 1.50X.
Risks to Invest in FSLR Stock
One major challenge for First Solar is the oversupply of solar modules from China. In 2024, solar module manufacturers, mainly based in China, added about 270 GW of new production capacity. This rapid expansion created an imbalance between supply and demand, leading to price volatility. If competitors continue to lower prices to very low levels or operate with minimal or negative margins for extended periods, it could weigh on First Solar’s sales, profitability and overall performance.
Another risk arises from new U.S. legislation passed in July 2025, known as the One Big Beautiful Bill Act. This law reduced the Investment Tax Credit for residential solar and storage systems purchased with cash or loans, with the credit set to expire by the end of 2025. It also phased down tax credits for storage projects starting in 2034, increased domestic content requirements and set stricter rules on foreign content. These changes may reduce customer demand, raise compliance costs and limit First Solar’s ability to qualify for future incentives, which could hurt its revenues and long-term growth outlook.
Conclusion
First Solar has delivered strong results and enjoys solid growth prospects backed by its expanding manufacturing capacity, long-term sales contracts and improving earnings outlook.
However, considering its premium valuation and the risks tied to oversupply from China, changing tariff policies and the recent reduction in clean energy tax credits in the United States, new investors may prefer to wait for a more favorable entry point.
Existing shareholders, however, can remain invested in this Zacks Rank #3 (Hold) stock given the company’s strong order pipeline, solid performance at the bourses and long-term growth potential. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.