Whether you use solar panels in your home, or not, it is very likely that you encounter a building that has functioning elements running on solar energy. First Solar, Inc. (NASDAQ:FSLR), the largest U.S. solar-panel manufacturer, was founded back in 1990 and, since then, has been outfitting private residences and businesses with solar panels at a reasonable price point. However, this week First Solar reported a 58% decline in profit as revenue slipped due to power plants being built in the Southwest.
But before you make your next financial decision about First Solar, Inc. (NASDAQ:FSLR), let’s take a look back at a top analyst’s performance while recommending First Solar in this week’s Throwback Thursday.
Citigroup analyst Shahriar Pourreza has a history recommending solar energy stocks, earning himself the number 21 spot out of 2416 analysts with a 21.6% average return over S&P-500 and a 57% success rate of recommended stocks. Following the release of the report, Shariar recommended BUY First Solar acknowledging that the quarter was “disappointing” but that, “First Solar continues to lean toward going forward without its own YieldCo: this is consistent with our prior thoughts. We believe that a project developer will enjoy some benefit from selling assets at higher prices in initial years. Eventually, we expect the lower cost of capital to be reflected in future PPAs and the benefit to First Solar to be reduced. The challenge is that it takes an increasing amount of MWs to feed the dividend growth especially as efficiencies improve and less EBITDA is generated from each MW.” Shahriar is holding out for future growth and believes that First Solar, Inc. (NASDAQ:FSLR) will turn around.
George Soros And The Human Uncertainty Principle
The division between academic economics and the way traders look at the market is deep. The efficient market hypothesis assumes that markets and valuations are always pushing towards an equilibrium, and evidence to the contrary gets pushed aside as fluctuations or statistical deviations. But the dot com bubble, the
Let’s take a look at Shahriar’s past First Solar, Inc. (NASDAQ:FSLR) recommendations.
Back in February 2013, Shahriar Pourreza earned one of his highest returns when he recommended BUY First Solar, Inc. (NASDAQ:FSLR). After news broke that First Solar’s third-quarter net income more than doubled, Shahriar chimed-in saying that he predicted “profitability down the road stemming from better efficiency, strong global demand and continued interest in solar from the U.S. utility companies.” He also observed that the company was expanding into non-traditional solar markets and was eager to recommend BUY, earning +81.3% over S&P-500.
In August of 2013, Shahriar also earned a high positive return when he recommended BUY First Solar, Inc. (NASDAQ:FSLR) . He advised investors to look past any concerns they had from the quarter and “Regarding Q3, any additional setbacks with the ABW or Campo Verde projects, and any additional cost overruns at AVSP could negatively affect Q3 results, yet guidance should be maintained in the event these items do take place in Q3 since they will be recognized in Q4. Management also reiterated their expected book-to-bill ratio of 1:1 for FY2013; despite the book-to-bill for Q2 deteriorating to 0.7 – primarily due to ill-timing of project bookings.” Shahriar earned +42.0% over S&P-500 with this recommendation.
First Solar, Inc. (NASDAQ:FSLR)’s disappointing results might leave you in the dark about your next solar energy move in your portfolio. Is Shahriar too optimistic this time? Or will his proven track record with First Solar lead you down to great, long term returns?
It’s your decision. Start making informed decisions with advice you can trust by downloading TipRanks today.