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On Tuesday, Truist Securities analyst Jordan Levy updated the firm’s stance on First Solar (NASDAQ:FSLR), reducing the price target to $245 from the previous $285, while sustaining a Buy rating on the company’s shares. The adjustment was made to align the solar panel manufacturer’s valuation more closely with its industry peers. Currently trading at $125.86 with a P/E ratio of 10.47, InvestingPro analysis suggests First Solar is undervalued, supported by strong fundamentals and a market capitalization of $13.5 billion.
Levy’s commentary highlighted the ongoing adjustments to estimates for First Solar following a recent review. Despite the anticipation of concerns related to the Inflation Reduction Act (IRA) lingering through the second quarter, Truist Securities remains optimistic about the potential benefits for First Solar. The firm expects that the domestic content requirements and tax credits under the 45x provision will remain intact, which would favorably impact First Solar, particularly if the company’s guidance includes revisions pertaining to Foreign Entities of Concern (FEOC) investment. InvestingPro data reveals the company’s strong financial health with a "GREAT" overall score, maintaining robust revenue growth of 26.75% over the last twelve months.
The analyst acknowledged that gaining short-term momentum might be challenging due to the current policy uncertainty. However, Truist Securities maintains a positive long-term outlook for First Solar. The firm’s confidence is based on the assumption that the U.S.-manufacturing-friendly components of the IRA will be preserved, which would present an attractive valuation for First Solar.
The update from Truist Securities comes at a time when the renewable energy sector is closely monitoring legislative developments and their potential impact on domestic manufacturing and investments. First Solar, as a leading player in the solar energy industry, is particularly sensitive to such policy changes and their influence on the company’s strategic direction and financial performance.
In other recent news, First Solar has seen several significant developments. Jefferies has adjusted its outlook on the company, raising the stock target to $202 while maintaining a Buy rating. This adjustment takes into account potential margin pressures that might affect earnings per share. On the other hand, Barclays (LON:BARC) has lowered its price target for First Solar to $236, maintaining an Overweight rating, and highlighted production dynamics across First Solar’s facilities, particularly in India, Malaysia, and Vietnam. Mizuho (NYSE:MFG) Securities also revised its target, reducing it to $252 but upheld an Outperform rating, citing stable pricing in the U.S. market. UBS has decreased its price target to $285, maintaining a Buy rating, and noted First Solar’s mid-point revenue guidance for 2025 as slightly above consensus. Additionally, First Solar has partnered with Everstream Analytics to enhance its supply chain resilience, focusing on risk insight and mitigation strategies. These developments reflect First Solar’s ongoing efforts to adapt to market dynamics and strengthen its operational capabilities.
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