First Solar Inc.
) hit a 52-week high of $52.69 on May 13, 2013, primarily driven
by its first quarter 2013 results. In the past 52 weeks, the
company's share prices have traded at a low of $11.43 and a high
of $52.69. The shares closed at $50.45, 212.6% above the
year-earlier share price of $16.14 as on May 11, 2012.
Although First Solar's adjusted first quarter 2013 earnings
missed our projection, the company swung to a profit in the
reported quarter after it incurred a loss in the year-ago period.
The improvement was helped by higher sales of solar modules.
The largest U.S. solar manufacturer by shipments, First Solar
also registered an almost 52% upsurge in its top-line on a
year-over-year basis. Revenues also beat the Zacks Consensus
Estimate by 3.5%.
The improvement was mainly attributed to high third-party module
sales volumes and an increase in revenues from systems projects.
On the cost front, total operating expenses in the first quarter
significantly declined to $108.1 million from $533.0 million in
the first quarter 2012.
First Solar has a strong balance sheet with a low long-term
debt-to-capitalization of 13.3% at the end of first quarter 2013
(Zacks industry average was 42.1%). The company ended the quarter
with $842.8 million of cash and cash equivalents, and long-term
debt of $562.2 million (including current portion). The strong
liquidity position of the company gives it a distinct advantage
over its cash-strapped peers.
Meanwhile First Solar is looking to expand in other regions
including Japan. The maker of thin film photovoltaic (PV) modules
and PV power plants, First Solar announced in Apr 2013 its
intention to acquire TetraSun from JX Nippon Oil & Energy
Corporation for an undisclosed amount. We note that JX
Nippon is the largest oil company in Japan. Post-acquisition,
both the parties intend to produce and market TetraSun products
The acquisition is expected to complete in the second quarter of
2013. The acquisition would be a strategic fit as Japan is
expected to become the second-largest market for solar products
in 2013 after China.
First Solar presently retains a short-term Zacks Rank #3 (Hold).
In the near term, solar companies that look more promising and
worth buying now include
JA Solar Holdings Co., Ltd.
STR Holdings, Inc.
Trina Solar Limited
), all with a Zacks Rank #2 (Buy).
FIRST SOLAR INC (FSLR): Free Stock Analysis
JA SOLAR HOLDGS (JASO): Free Stock Analysis
STR HOLDINGS (STRI): Free Stock Analysis
TRINA SOLAR LTD (TSL): Free Stock Analysis
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