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12 hours ago
- Business
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First Solar Plunges 21.2% in Past 6 Months: How to Play the Stock?
Shares of First Solar Inc. FSLR have plunged 21.2% in the past six months, underperforming the Zacks solar industry's decline of 19.3% as well as the broader Zacks Oil-Energy sector's growth of 5.3%. It also lagged the S&P 500's growth of 0.3%. Image Source: Zacks Investment Research On the contrary, other solar stocks, such as Canadian Solar CSIQ and SolarEdge Technologies SEDG, have outperformed the industry in the past six months. Shares of CSIQ have lost 7.8%, while shares of SEDG have gained 15%.With FSLR's weak performance on the bourses, some investors may consider buying the stock while it's cheap. However, before taking any decision, it is important to understand the reasons behind this dismal performance. Does the company have what it takes to bounce back, or are there risks that may affect its future growth? The idea is to help investors make a more insightful decision. FSLR's dismal performance on the bourses seems to have been influenced by its weak first-quarter 2025 results, recently imposed tariffs and manufacturing the company ended the first quarter on a dismal note, with its earnings per share going down 11.4% on a year-over-year basis. Its operating income also slid First Solar has been facing manufacturing issues affecting certain of its Series 7 modules manufactured in 2023 and 2024. This, in turn, has led the company to incur significant warranty charges in recent quarters. Looking ahead, warranty charges related to Series 7 manufacturing issues are estimated to result in total charges ranging between $56 million and $100 million in the near future. This, in turn, might adversely impact its operational in April 2025, the U.S. President announced a 10% 'baseline' tariff on most trading partners, including Vietnam, India and Malaysia, along with higher tariffs on select countries. While the higher tariffs were paused for 90 days, the 10% tariff remains in place for most countries. Since First Solar makes modules in these regions, the tariffs could raise costs, impact international operations and hurt overall operating results. The company has even lowered its 2025 guidance, taking into account the expected impact of the implementation of these new tariffs. As the largest solar PV manufacturer in the Western Hemisphere, First Solar continues to expand and invest in its manufacturing capacity, aiming to achieve sales growth in the coming quarters. Notably, the company began commercial operations at its fourth manufacturing facility in the United States in the second quarter of 2025. Moreover, it is currently in the process of expanding its manufacturing capacity by approximately four GW, including the construction of its fifth U.S. manufacturing facility, which is expected to commence operations in the second half of manufacturing capacity expansion plans should allow First Solar to maintain its position as the largest U.S. solar module manufacturer and boost its long-term operational line with this, the Zacks Consensus Estimate for FSLR's long-term (three to five years) earnings growth rate is pegged at 34.5%.However, the risks associated with the manufacturing issues of certain Series 7 Modules, as mentioned above, as well as the tariff impacts, might affect the company's performance in the near let's take a quick sneak peek at its near-term estimates to see if that reflects a similar trend. The Zacks Consensus Estimate for FSLR's 2025 and 2026 revenues indicates a solid improvement of 16.3% and 16.8%, respectively, from the prior-year levels. The same for its earnings also indicate a year-over-year improvement. Image Source: Zacks Investment Research However, the Zacks Consensus Estimate for FSLR's 2025 and 2026 earnings per share has moved down considerably in the past 60 days, indicating analysts' decreasing confidence in the stock's earnings-generating capabilities. Image Source: Zacks Investment Research FSLR shares are expensive on a relative basis, with its forward 12-month Price/Sales (P/S F12M) being 2.92X compared with its industry average of 1.16X. Image Source: Zacks Investment Research Its industry peers, CSIQ and SEDG, are trading at a discount. CSIQ is trading at a P/S F12M of 0.10X, while SEDG is trading at a P/S F12M of 0.83X. Investors interested in FSLR should wait for a better entry point, considering its premium valuation, downward revision in earnings estimates and near-term risks associated with tariff those who already own this Zacks Rank #3 (Hold) stock may continue to do so, taking into account its upbeat sales estimates and long-term growth can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report First Solar, Inc. (FSLR) : Free Stock Analysis Report Canadian Solar Inc. (CSIQ) : Free Stock Analysis Report SolarEdge Technologies, Inc. (SEDG) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
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KeyBanc cuts solar names to Underweight on ‘overwhelming' overhang
KeyBanc analyst Sophie Karp downgraded Sunrun (RUN), Enphase Energy (ENPH) and SolarEdge (SEDG) to Underweight from Sector Weight after Senate Republicans last night released a bill that would end tax credits for wind and solar earlier than for other sources. The new version of the bill would end incentives for wind and solar in 2028, though tax breaks for other sources of power including nuclear, hydropower and geothermal would be allowed to remain until being phased out in 2036. KeyBanc cites the 'ongoing and overwhelming regulatory overhang' for the downgrades. The Senate bill 'fails to deliver optimism' and the solar provisions are 'particularly punishing for the sector,' the analyst tells investors in a research note. KeyBanc's price targets are $31 for Enphase, $6 for Sunrun, and $16 for SolarEdge. Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Published first on TheFly – the ultimate source for real-time, market-moving breaking financial news. Try Now>> See the top stocks recommended by analysts >> Read More on RUN: Disclaimer & DisclosureReport an Issue Video: Verve, solar stocks among major pre-market movers Why Is Sunrun Stock (RUN) Down 35% Today? Sunrun downgraded to Underweight from Sector Weight at KeyBanc Sunrun downgraded to Sell with 1c price target at GLJ Research Sunrun downgraded to Sell from Hold at GLJ Research Sign in to access your portfolio
Yahoo
2 days ago
- Business
- Yahoo
Solar stocks are plummeting as the Senate version of Trump's 'big beautiful bill' hits clean energy
Solar stocks tumbled on Tuesday, with Solar Edge and First Solar down sharply. The Senate version of the GOP budget bill keeps cuts to clean energy in place. The new government policy would phase out solar and wind energy tax credits. Solar energy stocks plunged for a second day on Tuesday, on news that the Senate version of the budget bill retains cuts to renewable energy tax credits. A US Senate panel has proposed fully phasing out all tax credits for solar and wind energy within the next three years. The development swiftly sent solar energy stocks into free fall, including First Solar, SolarEdge and Sunrun. First Solar fell as much as 22%, while SolarEdge declined as much as 42%, and Sunrun dropped 44%. The proposed tax policy changes are part of the Senate's version of President Donald Trump's "One Big Beautiful Bill Act," a budget package that was recently passed in the House of Representatives. Under the current policy, passed during the Biden administration's Inflation Reduction Act in 2022, subsidies for solar and wind energy would remain in place until 2032. But the new vision outlined by Republican officials includes granting 100% of the tax credits to hydropower, nuclear, and geothermal energy, areas of the energy sector that the Trump administration favors. Republican Senator Mike Crapo, who serves as founder and co-chairman of the Senate Nuclear Cleanup Caucus, has released a text summary of the bill, which promises to eliminate billions of dollars of clean energy subsidies, describing them as unnecessary and highlighting the need to prioritize other energy sources. These changes have been met with blowback from the clean energy industry, whose advocates have touted the economic consequences of eliminating solar and wind subsidies. This list includes Ari Matusiak, CEO of clean energy nonprofit Rewiring America, who has stated that "Eliminating the tax credits that save families money is a profound mistake." Ed Mills, a managing director and Washington policy analyst for Raymond James, notes that "While the Senate proposal still represents a material negative for renewable energy investment/names, it is a significant improvement from the House." So far, though, the "material negative" seems to be outweighing any improvements for solar stocks. And the corner of the energy sector could have further to fall if the Senate proposal moves forward. It stands to not just eliminate billions of dollars in subsidies that have allowed the renewable power industry to grow, but to provide them to companies that produce competing energy sources. Read the original article on Business Insider Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
SunRun Stock Plunged 40% Tuesday—Watch These Key Price Levels
SunRun shares plummeted Tuesday, leading a steep sell-off in solar energy stocks after the Senate maintained the full removal of clean-energy tax credits in the budget bill. A chart pattern that closely resembles a falling three methods has recently emerged, signaling a continuation of the stock's long-term move lower. Investors should watch key support levels on SunRun's chart around $4.75 and $4.33, while also monitoring important overhead areas near $8.50 and $ (RUN) shares plunged Tuesday, leading a steep sell-off in solar energy stocks after the Senate maintained the full removal of clean-energy tax credits in its version of the budget bill. The move comes after SunRun and other bellwether solar names tumbled last month after the House passed a tax and spending bill that would end tax credits for wind and solar projects in 2029, years earlier than a previous version of the bill. Following today's development, Citi maintained its sell rating on residential solar stocks and cautioned that it expects a 'sharp pullback' in shares of SunRun, SolarEdge Technologies (SEDG) and Enphase Energy (ENPH). SunRun shares fell 40% on Tuesday, closing the session at $5.78. The stock has lost three-quarters of its value since hitting its 52-week high last August, weighed down by uncertainty surrounding the sector caused be policy changes, a clouded regulatory outlook and reduced demand. Below, we take a closer look at SunRun's weekly chart and use technical analysis to identify key price levels worth watching out for. Since topping out in early 2021, SunRun shares have remained entrenched in a steady downtrend, with losses in the stock accelerating after the 50-week moving average (MA) crossed below the 200-week MA in September 2022 to form a death cross. More recently, a chart pattern that closely resembles a falling three methods has emerged, signaling a continuation of the stock's long-term move lower. What's more, the relative strength index has fallen back below its neutral threshold, confirming a resumption of selling momentum. It's also worth noting that trading volume has increased in recent weeks, indicating growing interest in the stock from both retail and institutional investors. Let's identify two key support levels to watch on SunRun's chart if the price keeps falling and also locate overhead areas worth monitoring during future recovery efforts in the stock. Firstly, it's worth keeping a close eye on the key $4.75 level. This area may attract strong buying interest near an established floor of support that formed on the chart between October 2016 and May 2017. A breakdown below this level could see the shares drop to around $4.33. We projected this level by taking a look what happened when the stock dropped by more than 40% in a week during the March 2020 pandemic-driven sell-off. On that occasion, the shares dropped a further 25% the following week before staging a dramatic recovery. Therefore, a decline of a similar magnitude from Tuesday's close of $5.78 projects a downside target of $4.33, assuming the stock ends this week around its current trading levels. However, keep in mind this analysis is speculative, given the stock fell by more than 40% in a week last month and has kept moving lower. During recovery efforts in the stock, investors should monitor the $8.50 area. The shares may face renewed selling pressure in this region near prominent troughs that formed on the chart in March 2020 and October 2023. Finally, buying above this level could see an upswing toward $13.25. Investors who have bought SunRun shares at lower levels may seek to lock in profits at this location near last month's high, which also closely aligns with a range of corresponding trading activity on the chart extending back to mid-2018. The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info. As of the date this article was written, the author does not own any of the above securities. Read the original article on Investopedia Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
Solar stocks are plummeting as the Senate version of Trump's 'big beautiful bill' hits clean energy
Solar stocks tumbled on Tuesday, with Solar Edge and First Solar down sharply. The Senate version of the GOP budget bill keeps cuts to clean energy in place. The new government policy would phase out solar and wind energy tax credits. Solar energy stocks plunged for a second day on Tuesday, on news that the Senate version of the budget bill retains cuts to renewable energy tax credits. A US Senate panel has proposed fully phasing out all tax credits for solar and wind energy within the next three years. The development swiftly sent solar energy stocks into free fall, including First Solar, SolarEdge and Sunrun. First Solar fell as much as 22%, while SolarEdge declined as much as 42%, and Sunrun dropped 44%. The proposed tax policy changes are part of the Senate's version of President Donald Trump's "One Big Beautiful Bill Act," a budget package that was recently passed in the House of Representatives. Under the current policy, passed during the Biden administration's Inflation Reduction Act in 2022, subsidies for solar and wind energy would remain in place until 2032. But the new vision outlined by Republican officials includes granting 100% of the tax credits to hydropower, nuclear, and geothermal energy, areas of the energy sector that the Trump administration favors. Republican Senator Mike Crapo, who serves as founder and co-chairman of the Senate Nuclear Cleanup Caucus, has released a text summary of the bill, which promises to eliminate billions of dollars of clean energy subsidies, describing them as unnecessary and highlighting the need to prioritize other energy sources. These changes have been met with blowback from the clean energy industry, whose advocates have touted the economic consequences of eliminating solar and wind subsidies. This list includes Ari Matusiak, CEO of clean energy nonprofit Rewiring America, who has stated that "Eliminating the tax credits that save families money is a profound mistake." Ed Mills, a managing director and Washington policy analyst for Raymond James, notes that "While the Senate proposal still represents a material negative for renewable energy investment/names, it is a significant improvement from the House." So far, though, the "material negative" seems to be outweighing any improvements for solar stocks. And the corner of the energy sector could have further to fall if the Senate proposal moves forward. It stands to not just eliminate billions of dollars in subsidies that have allowed the renewable power industry to grow, but to provide them to companies that produce competing energy sources. Read the original article on Business Insider
