Broadpoint.AmTech Maintains a 'Buy' on First Solar (FSLR)

Broadpoint analyst says, "Following updated cost reduction guidance from poly-based module producers last week, we are reducing our FSLR 2010 estimates to better reflect a more competitive landscape in 2H10 (namely TSL projecting $0.70/w processing cost). We still view FSLR as the best positioned solar company industry-wide, and see visibility into a return to capacity expansion/earnings growth in 2011 as a key catalyst for the stock...We are revising FY10 revenue and EPS from $2.6B and $8.86 to $2.4B/$7.11 and introducing FY11 revenue and EPS of $3.1B and $8.96. While we are essentially pushing out our earnings number one year, we remain constructive on FSLR shares given the company's superior margin structure, return on capital metrics, and our belief investors will return to shares as the capacity ramp in 2H11 becomes more visible...While we are disappointed by FSLR's underperformance YTD, we see the set-up as improving into 1H10 following a significant margin reset, coupled with capacity expansions in the out-year. While FSLR will prove to be a massive share gainer in 2009, the stock has underperformed given the outlook for industry lagging earnings growth in 2010. We believe the stock will likely begin to act better in 1H10 as FSLR is set to grow in-line or better than the group in 2011."

Labels: First Solar Inc, FSLR, solar analysis, Solar Stocks

posted by Ertai at 9:19 AM