Consistent R&D efforts from solar cell manufacturer
First Solar Inc
) yielded positive results. The company was able to manufacture
its most advanced thin-film photovoltaic (PV) module, the Series
3 FS-392, which is rated at 92.5 watts. The new modules abide by
existing IEC certifications and Underwriters Laboratories (UL)
listings for the Series 3 family.
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Solar cell manufacturers continue to invest in R&D with the
sole objective of producing advanced PV modules, having higher
conversion rates. This is crucial as higher conversion rates
bring down the cost of implementing a solar power project.
First Solar strives to bring about greater efficiency in module
conversion. The company invested $32.4 million in R&D in the
third quarter, which comprised 3.9% of total sales.
The thin-film technology used by First Solar to develop solar
modules make them more efficient compared to the silicon PV.
These new solar modules have high energy density and are capable
of being used in PV systems of up to 1,000 volts. This voltage is
typical for large scale PV power plants.
Solar cell manufacturers in the U.S. are facing strong
competition from their Chinese counterparts. The China-based
companies have flooded the market with lower priced solar
modules. We believe the one way to counter this threat is by
developing cheaper, high-quality solar modules. Besides, the
decision by the U.S. government to impose anti-dumping duty and
counter subsidy duty on the Chinese manufacturers will definitely
make the competition more even.
We believe the demand for its new products, cost structure
improvement and contract wins will help First Solar to achieve
the earnings per share target of $4.40 to $4.70 per share for
2012. The Zacks Consensus Estimate for 2012 is $4.59 per share.
We presently prefer First Solar with a short-term Zacks #3 Rank
(Hold rating) to its peer
Suntech Power Holdings Co. Ltd.
) that has a short-term Zacks #4 Rank (Sell rating).
Headquartered in Tempe, Arizona, First Solar Inc. designs,
manufactures, and sells solar electric power modules using a
proprietary thin film semiconductor technology.