First Solar, Inc.

(NASDAQ Global Select)
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Somewhat Bullish +35

Can First Solar Stock Fall 30%?

Capacity expansion Guidance lowered Production update AI-generated analysis

πŸ“‰ First Solar stock has fallen over 30% within a calendar year in nine of the past ten years, with shares trading at $195.76 as of November 5.

πŸ“Š Third-quarter sales dropped 22.8% from a year earlier due to fewer modules sold to third-party buyers.

πŸ“‰ Management lowered 2026 forecasts for module sales from the India facility and international Series 6 lines.

πŸ“‰ Revenue and adjusted EBITDA guidance were reduced alongside the lower volume projections.

πŸ“‰ Sales growth has stalled, with twelve-month sales to September 30, 2026, down 0.7% compared to the prior year.

πŸ“‰ Customers are delaying orders for later years, focusing on projects where they already hold modules.

⚠️ First Solar is evaluating demand and tariffs at its Malaysia facility, with a production decision expected in the first half of 2027.

πŸ’° Gross margins expanded significantly to 57.9% in the third quarter from 38.3% a year earlier.

πŸ“œ The company ended the quarter with 44 gigawatts of modules under contract worth approximately $13.5 billion.

πŸ“ˆ New deals since the U.S. Section 232 proclamation have included price increases on some early-stage negotiations.

πŸ’΅ First Solar trades at 11.3 times trailing earnings, compared to 22.9 times for the S&P 500.

πŸ” The stock fell 25.5% over the past twelve months while the S&P 500 returned 9.9%.

πŸ“ First Solar has booked about 1.4 gigawatts of new U.S. orders since its previous earnings call.

πŸ“… The next quarterly report is expected in February 2027 to provide updates on new order counts.

Bullish Signals
  • Gross margins rose sharply to 57.9% in the third quarter from 38.3% a year earlier, driven by a higher share of U.S.-made modules.
  • The company ended the quarter with a robust backlog of 44 gigawatts of contracted modules valued at approximately $13.5 billion through 2030.
  • Management raised prices in new deals following the U.S. Section 232 proclamation, including increases on some early-stage negotiations.
  • First Solar has booked about 1.4 gigawatts of new U.S. orders since its previous earnings call, indicating continued demand.
  • The stock trades at a discount to the market with a P/E ratio of 11.3 times trailing earnings versus 22.9 for the S&P 500.
Risk Factors
  • Third-quarter sales fell 22.8% from a year earlier due to fewer modules sold to third-party buyers.
  • Management lowered the 2026 forecast for modules sold from the India facility and international Series 6 lines.
  • Revenue and adjusted EBITDA guidance were reduced alongside the lower volume projections for the India and U.S. facilities.
  • Sales growth has stopped, with twelve-month sales to September 30, 2026, down 0.7% compared to the prior year.
  • Customers are delaying orders for later years, deferring purchases for early-stage developments due later in the decade.
  • First Solar is evaluating whether to stop production or run its Malaysia facility at full capacity by the first half of 2027.
Full Analysis
First Solar (FSLR) stock has declined significantly, falling over 30% within a calendar year in nine of the past ten years. As of the November 5 close, shares were trading at $195.76, and analysts note that a further drop to approximately $137 would not be unprecedented for current shareholders. The company's recent third-quarter sales fell 22.8% from the prior year, even as profitability increased. Management attributed the sales decline primarily to reduced shipments of solar modules to third-party buyers. Consequently, executives lowered their full-year 2026 forecasts for module sales from both the India facility and international Series 6 lines, alongside reductions in U.S. production projections. This led to downward revisions for both revenue and adjusted EBITDA guidance. Despite the slowdown in sales volume, First Solar's financial health remains robust due to a substantial increase in gross margins, which rose to 57.9% from 38.3% a year earlier. The company holds a strong backlog of 44 gigawatts of contracted modules valued at roughly $13.5 billion, with deliveries scheduled through 2030. Additionally, the stock trades at a valuation of 11.3 times trailing earnings, significantly lower than the S&P 500's multiple. Holders are advised to monitor new order bookings closely as the primary indicator of future growth potential. Since its previous earnings call, First Solar has booked approximately 1.4 gigawatts of new U.S. orders. The next quarterly report expected in February 2027 will provide further clarity on the trajectory of new contract acquisitions.