Shares of First Solar (FSLR, Financial) declined 10.02% following the announcement of Republican candidate Donald Trump's victory in the 2024 US presidential election, causing a notable downturn in renewable energy stocks.
First Solar Inc (FSLR, Financial) currently trades at $194.25, reflecting concerns in the market regarding potential policy shifts under the new administration. Despite this recent dip, the company maintains a strong financial position with a market capitalization of $20.80 billion and a price-to-earnings (P/E) ratio of 16.73.
From a valuation perspective, First Solar is considered fairly valued with a GF Value of $215.30. This suggests that the current stock price is close to its intrinsic value, offering limited upside potential based on current metrics. The stock's price-to-book (P/B) ratio stands at 2.74, indicating a reasonable valuation compared to its peers in the solar industry.
Investor sentiment is further supported by First Solar's robust Altman Z-Score of 5.15, which signals strong financial health and a low risk of bankruptcy. The company also benefits from having a solid Altman Z-Score, suggesting good growth prospects with an EBITDA growth rate of 118.1% over the past year.
However, there are a few warning signs investors should be aware of. First Solar has been issuing new debt, amounting to $761.172 million over the past three years. While this level is considered manageable, it is something to keep an eye on. Additionally, insider selling activity has been noted, with 12,720 shares offloaded in the past three months.
Despite these challenges, First Solar's strong financial foundation and leading position as the largest thin-film solar module manufacturer globally position it well for future growth in the renewable energy sector. As market conditions evolve, investors should continue to monitor policy changes and their potential impact on the renewable energy landscape.
