Auriga Reiterates Buy On First Solar (FSLR), Raises PT To $175
Auriga remains quite bullish on First Solar (FSLR) following last night’s earnings report, reiterating their Buy rating and raising the price target to $175. The firm believes it’s separating itself from the competition by continuing to drive costs lower. During the quarter, manufacturing costs declined by 6% over the previous quarter and 13% year over year. While they indicate some negatives on the conference call, overall Auriga believes the positives far outweigh the negatives. They detail each of those…
====> Click Here For Your FREE First Solar Technical Analysis
Positives
– Decreasing manufacturing costs was a surprise because FSLR had been unable to do that for much of the past year
– Line throughput increased to 59MW increasing capacity much sooner than originally thought
– Module efficiency increased to 11.2% and expected to avg 12% next year
– FS Series 3 modules launched which reduces voltage and allows for 30% more modules/string
Negatives
– Manufacturing defect charge to cost $27 million, but minor issue considering it’s already factored into EPS guidance. Installers not seeing any ongoing issues and Auriga says brand not effected
– Guidance was mixed: FSLR more profitable on less revenue, but investors likely to focus on the $100 million cut to EPC revenue forecast. Management’s somber tone did little to excite investors
Looks like traders are focusing on the negatives this morning with the stock down about 4%. The key support level for FSLR now is in the 120 – 125 range. It needs to hold that level or another test of the $100 becomes more likely.
Tags: auriga, earnings, first solar, fslr
No comments yet.
Leave a comment