First Solar: A Growth-Story Buy?

First Solar, Inc.’s (FSLR) growth story will continue with its order backlog surpassing $6 billion, higher capacity online with two more facilities under construction in Malaysia, higher capacity at its Ohio facility, lower dependence on the German market, declining cost per watt, and new utility scale PV [photo-voltaic] system deployments in the United States.

First Solar’s reliance on low-cost thin-film cells helped the company avert a silicon shortage, which ravaged the bottom-line of other solar peers. However, a falling Euro in light of its focus on Europe, tightening credit markets, and the modules oversupply situation in the market could partially hamper growth.

Accordingly, we maintain our speculative BUY recommendation on FSLR with a six-month target price of $185.00. Price appreciation to our near-term valuation target represents 30.3% upside potential.

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