First Solar, Inc. (FSLR): A Bear Case Theory
We came across a bearish thesis on First Solar, Inc. (FSLR) on Stock Whisperer's Substack. In this article, we will summarize the bears' thesis on FSLR. First Solar, Inc. (FSLR)'s share was trading at $158.38 as of 23rd May. FSLR's trailing and forward P/E were 13.46 and 10.17 respectively according to Yahoo Finance.
Solar panels in an agricultural field, highlighting the company's commitment to renewable energy.
First Solar (FSLR) appears to be under meaningful pressure, with a confluence of technical, fundamental, and sentiment indicators suggesting short-term downside risk. Technically, the stock is firmly in a downtrend, forming lower highs and lows, with the MACD signaling persistent negative momentum. Heightened trading volumes on down days point to institutional selling, while a critical support level at $120 could invite further selling if breached. A break above $160 resistance seems unlikely in the current environment.
Fundamentally, while a low trailing P/E of 11.09 may imply value, sector-wide volatility, rising interest rates, and tariffs have clouded growth prospects. Even with a 36% forecasted EPS growth, rising costs and weaker guidance have weighed on earnings credibility. The stock now trades near its 52-week lows, reflecting macroeconomic headwinds and sector challenges.
Sentiment around FSLR is largely negative, further pressured by recent earnings misses, guidance cuts, and analyst downgrades, including one from Jefferies. Broader weakness in the technology and energy sectors, coupled with ongoing tariff uncertainty, further dampens the investment case. Without a material catalyst—such as policy support or operational surprises—the stock is likely to remain under pressure over the next 1–4 weeks. While long-term investors may see an eventual rebound opportunity tied to renewable energy trends, the short-term risk/reward skews bearish. Investors should proceed with caution, recognizing the potential for further downside unless key technical levels hold and sentiment materially shifts.
Previously, we have covered First Solar, Inc. (FSLR) in April 2025, wherein we summarized a bearish thesis from Oliver | MMMT Wealth on Substack. The author highlighted First Solar's unique CdTe technology and its advantage from U.S. tariffs on imported silicon panels. It was seen as well-positioned to benefit from rising demand for American-made clean energy amid geopolitical shifts. Since our last coverage, the stock is up 31%.
First Solar, Inc. (FSLR) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 52 hedge fund portfolios held FSLR at the end of the first quarter which was 65 in the previous quarter. While we acknowledge the risk and potential of FSLR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than FSLR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None. This article was originally published at Insider Monkey.
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