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Investing.com -- First Solar Inc (NASDAQ:FSLR) on Tuesday received a price target increase from Jefferies to $194 from $192, representing a 21% upside from the current price of $160.84.
Analysts described First Solar as "one of the most macro-entangled" companies in the renewables sector, with its 2025 guidance and Southeast Asian facilities dependent on tariff decisions. Despite these uncertainties, Jefferies maintained a Buy rating on the stock.
The firm expects clarity on the Inflation Reduction Act (IRA) to drive increased volumes in 2026 and believes First Solar’s Southeast Asian facilities will remain operational in the near term.
Treasury guidance remains a wild card for the solar industry broadly, potentially slowing near-term project development activity.
For the upcoming second quarter, Jefferies estimates revenue of $988 million, 5% below consensus, with gross margins of 41% compared to the 40% consensus.
The firm noted that investor focus will be on First Solar’s customer conversations and outlook for activity in the second half of 2025 and first half of 2026.
Jefferies raised its 2025 revenue and EBITDA estimates to $5.2 billion and $2.3 billion, respectively, which are 3% and 8% above consensus.
The firm projects volume growth in 2026 and 2027 to reach 22.2GW and 22.4GW, exceeding consensus by 8% and 2%.
Recent tariff decisions include the U.S. imposing 25% tariffs on Malaysia and 20% on Vietnam, though some ambiguity remains regarding Vietnam.
Analysts expect First Solar to consider adding finishing lines in the United States, while its Southeast Asian and Indian volumes could still find a market in the U.S. despite the tariffs.
The recent Executive Order to tighten guidance around the "beginning of construction" rule adds complexity, but Jefferies believes the impact of potential guidance changes may be overestimated.
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