First Solar

First Solar, Inc. (NASDAQ:FSLR) reported better than expected first quarter results on Wednesday. The solar company’s Q1 EPS came in at $1.10, beating the consensus estimate of $0.56. Revenues soared to $950 million, again surpassing the Wall Street forecast of $838 million and last year’s $659 million. However, Goldman Sachs analysts Brian Lee, Thomas Daniels and Britt Boril said the beat was mainly due to project timing.

First Solar

First Solar’s strong Q1 performance was due to project timing

First Solar, Inc. (NASDAQ:FSLR) recognized 100% revenue of its 139MW Campo Verde project. And the analysts believe that the below consensus second quarter EPS guidance of $0.61 was also a result of the project timing and revenue pull-forward. Anyway, First Solar raised its full-year 2014 EPS guidance from $2.20-$2.60 to $2.20-$2.80 on potential improvement in gross margins to 17-18%.

First Solar-2

The Tempe, Arizona-based company reiterates it full year book-to-bill target of 1:1. Through early May, First Solar, Inc. (NASDAQ:FSLR) has recorded bookings of 404MW. Now the company will have to achieve about 80% of its 2GW volume target in the next 7 months. That seems quite difficult given the soft bookings in the beginning of 2014. Moreover, Goldman Sachs noted that ASPs on projects booked so far this year are close to $1.50 per watt, almost flat compared to the previous quarter.

Goldman Sachs remains bearish on First Solar

Goldman Sachs analysts said that the first quarter results did little to change their bearish view on First Solar, Inc. (NASDAQ:FSLR). Analysts believe that the company is mis-positioned versus its peers. Goldman Sachs has a Sell rating on the stock with $49 price target. The research firm said Q1 results suggest that the company has made limited progress in the rooftop market, which is expected to grow at more than 50% in the next few years.

First quarter results show that the company has made progress since last year, but it still has a long way to go. First Solar, Inc. (NASDAQ:FSLR)’s earnings are still declining on an annual basis.

First Solar, Inc. (NASDAQ:FSLR) shares gained 0.82% to $64.09 in pre-market trading Thursday.