First Solar, Inc. (NASDAQ:FSLR) revealed its earnings numbers for the first three months of 2014 this afternoon after the bell rang in New York. The company showed earnings per share of $1.10 for the three-month period on revenue totaling $950 million. On Tuesday’s market shares in the company were impacted by wider pessimism, and lost more than 1% of their value. The company’s stock finished trading at $67.45.
Analysts were expecting First Solar, Inc. (NASDAQ:FSLR) to show a decline in earnings in this afternoon’s report. A Businessweek survey of 15 analysts following the company found a consensus forecast of 52 cents per share in earnings. Revenue was projected by the same group of analysts to come in at $837 million for the three months that opened the year. In the first quarter of 2013 First Solar earned 69 cents per share on revenue of $659 million.
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First Solar goes big
First Solar, Inc. (NASDAQ:FSLR) is a favorite of investors looking to get into the solar industry because it has a longer track record than most, and its management seems to have a cohesive strategy for the future of the company. Right now that strategy seems concentrated on getting involved in bigger contracts that could boost revenue and earnings stability.
The utility-scale market for solar in the United States is likely to be the focus for First Solar, Inc. (NASDAQ:FSLR) in the medium term, and, if growth is on the scale that analysts expect, it’s likely to be the center of a legitimization of the solar industry as a whole. First Solar has done well in recent years on the back of growing investment in solar, but the company is still a long way from the kind of growth priced into its highs.
First Solar runs high on solar optimism
Despite the poor performance of the big momentum stocks in the opening months of 2014, shares in First Solar, Inc. (NASDAQ:FSLR) have performed extraordinarily well. The company has increased in value by more than 23% since January 1, well ahead of the anaemic 1% gains made by the S&P 500. The firm’s shares have been running well for a long time on the back of hopes that the solar industry is finally ready to come into its own.
There’s been a lot of promise in the US solar industry for a decade, but the industry has yet to really secure the confidence of the market place, or the public. Companies like First Solar, Inc. (NASDAQ:FSLR) rode the first boom in solar stocks into the collapse of oil prices in 2007/2008. The firm’s stock is once again on a bull run, and there is more to anchor the increase this time around. There are still a huge amount of risks in the industry, however, and investors confidence will need to be secured with fundamental strength.
With tonight’s earnings behind it, First Solar, Inc. (NASDAQ:FSLR) looks stronger than it did a year ago, but it’s still a long way off of security. The company’s earnings are still falling on an annual basis, and this year is expected to see very slim margins indeed. Though revenue is increasing that may not be enough to support the stock in the minds of investors.