The reaction to last night’s earnings in shares of FSLR is really nothing new.  This is one of those companies where traders have lofty expectations and whatever it does, can never seem to please.  It seems traders are always picking through the report to discover the negatives.. looking for a reason to sell.  That’s the case again this morning.

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The company beat estimates after the bell yesterday on both the top and bottom line.  The company reported an EPS of $1.33 (vs the analyst estimate for $1.16) on revenues of $567 million (vs the estimate for $544 million).  I suppose traders were  disappointed in declining margins, looking for stronger guidance and are still uncertain about what’s going to happen in Italy, but FSLR did keep guidance intact, reiterating last quarter’s guidance for 2011.  They still expect EPS in the range of $9.25 – $9.75 on revenue of $3.7 – $3.8 billion.

“Despite European market uncertainties, First Solar has good visibility into our demand for 2011,” said Rob Gillette, CEO of First Solar. “We continue to execute our cost roadmaps, invest in new module capacity, build our project pipeline and develop promising new markets around the world.”

Shares of FSLR opened down more than 6%, but are recovering a bit off the opening lows.  In my opinion, shares of FSLR probably need to test the next level of major support after taking out the 50 and 200 day moving averages.  That area is around the $120 level.  While I still like FSLR, there is no reason to jump in here as shares remain in a steady downtrend.