FSLR Downgrade; Falls; Is Still Overvalued
June 5th, 2009 by 
CA Editors
Stephen Frankola sends: Barrons wrote about First Solar’s (FSLR) weaknesses and competitive threats this weekend (Reuters coverage of Barron’s commentary here), and an analyst, FBR Capital Markets, followed up Barron’s with a downgrade last Tuesday morning.
The FBR analyst, who slapped an “underperform” rating on FSLR, mused that “recent checks indicate at least one of First Solar’s top customers has already switched from First Solar to a silicon-based module vendor for a project that is currently under construction.”
The Yahoo! article covering the analyst downgrade elaborated:
“Hosseini noted that FBR’s meeting with the KfW Bank Group, a Frankfurt-based development bank that lends especially to economic, social and ecological projects internationally, revealed that its year-to-date photovoltaic project backlog has shifted dramatically toward silicon-based modules compared with its 2008 thin-film-focused mix.”
I have previously drawn similar conclusions on this blog and on Student Stocks. First Solar is a company that is ALREADY overvalued even before considering the significant, growing competition that they face from both silicon-panel makers and thin-film outfits. Though the share price unfortunately increased after my last article, I made (real) money in the past shorting FSLR from $280 to $140. Though shares have fallen $20 (10%) since the Barrons and FBR pieces, shares still should have plenty of downside room. I tried to short FSLR a few weeks ago (shares were at levels similar to today’s price) but none were available.
I continue to dislike FSLR shares at this price, in this environment. I’d never go long, and I will be considering initiating a short position.
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Originally published by Stephen on TheNoBuyList, a blog focused on negative analysis of companies.
See more Energy, FSLR, Short Stocks, Solar, Stephen Frankola | 
June 5th, 2009 at 1:56 am
If yo uknew it all you would not be talking not thinkink it might, but doing it.
June 5th, 2009 at 1:58 am
Short FSLR and see what happens.
June 5th, 2009 at 2:17 am
This site is hilarious - I thought it was satire at first, a cruel hedge fund manager’s way of making his worst performing minions learn basic trading lessons. You are using your short FSLR position as a reference point when everybody in the market thought the apocalypse was about to happen and people were buying guns hand over fist? Now that we are rebounding with commodities and energy rising, do you not notice that the solar stocks are moving alongside it? Thanks for the unintentional comedy kiddies.
June 5th, 2009 at 9:19 am
Anyone citing FBR is dangerous indeed. Watch your step or you might step in it.
June 5th, 2009 at 10:39 am
FSLR will be at $200 again before Mid July at the latest. My prediction. The switchover contract is easily balanced by the news releases of new contracts. Hold tight FSLR investors. I am long on FSLR (bought at $123).
June 8th, 2009 at 10:07 pm
Mr. Moe
Your observation that solar stocks perform similarly to traditional energy stocks is profound.
In the short term, the two will move in tandem. But the solar industry is becoming crowded and FSLR’s technologies aren’t the silicon-killers they once were.
I’m not short, but I wouldn’t go long.