{"id":134,"date":"2018-02-26T00:01:52","date_gmt":"2018-02-26T00:01:52","guid":{"rendered":"http:\/\/www.cheapertrader.com\/?p=134"},"modified":"2018-02-26T00:06:34","modified_gmt":"2018-02-26T00:06:34","slug":"first-solar-keep-an-eye-on-this-one","status":"publish","type":"post","link":"https:\/\/www.cheapertrader.com\/index.php\/2018\/02\/26\/first-solar-keep-an-eye-on-this-one\/","title":{"rendered":"First Solar – Keep an eye on this one"},"content":{"rendered":"

First Solar (NASDAQ:FSLR) released their Q4 results last week. Although operating profit was\u00a0higher than expected for the quarter,\u00a0revenue came in under $100m\u00a0below expectations.<\/a>\u00a0On Friday, investors punished the share\u00a0as a result and\u00a0shares ended nearly 7% down.\u00a0More drops like this may also be on the horizon, but could this share eventually charge higher in the coming months and years?<\/p>\n

First Solar Inc was founded in 1999 and designs and manufactures solar modules. The current strategy is comprised of 2 main segments – module sales & systems. Module sales are simply solar modules that are sold to other companies, whereas systems is primarily around project based work where First Solar is responsible for the development of various solar based projects. For systems, revenue can be inconsistent and margins can vary.\u00a0At the moment, the module sales comprise of only 20-25% of sales, vs system sales that make up the majority. Over the next 3 years however, the company is looking to become more focused on module sales as opposed to system sales.<\/p>\n

Although the company was founded in 1999, the company didn’t become a publicly traded company until 2006.\u00a0Since then,\u00a0the share prices has had some lofty highs. The share price even reached as high as 260+. Over the past couple of years however, the share price has fluctuated\u00a0between\u00a0 20\u00a0and 70 almost like a yo-yo (see chart below).<\/p>\n

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From the chart, it looks as though we are at the top of a cycle about to enter another downturn.\u00a0 It would appear that the negative Q4 results\u00a0could be a catalyst for a possible downturn.<\/p>\n

Let’s\u00a0dig a bit deeper though and\u00a0take a look at what the numbers from the FY report<\/a><\/p>\n