Jefferies upgrades First Solar as 'only game in town' due to looming import restrictions

CNBC

11-06-2025

First Solar is now the "only game in town" thanks to the likely passage of legislation by the Senate designed to disrupt the supply chains of the renewable energy industry, according to Jefferies. Jefferies upgraded First Solar to buy from hold, with a stock price target of $192, up from $157 previously, implying nearly 17% upside from Tuesday's close of $164.62 shares. The Senate appears likely to pass legislation that would quickly phase out Inflation Reduction Act tax credits for clean energy companies that receive "material assistance" from some foreign suppliers. The provision essentially targets imports of basic materials from China. This will trigger a temporary pullback for the utility-scale solar industry, according to Jefferies. First Solar, however, will benefit because its product is increasingly manufactured in the U.S. It could see strong average selling prices for solar modules as a consequence of the restrictions, according to Jefferies. "We believe IRA is going to shape-out net positive for FSLR ... or at least better than contemplated," analysts led by Julien Dumoulin-Smith told clients in a note published Wednesday. In a separate note, Jefferies downgraded Sunrun to underperform from hold and cut its 12-month price target to $5 from $6. "Budget reconciliation has residential solar on the chopping block, and while we expect some improvements on IRA post Senate, we see limited upside for resi, exposing RUN to both [near term] and [long term] headwinds," the investment bank wrote.