FSLR - Embedded Expectations Analysis - 2018 08 16
First Solar, Inc. (FSLR:USA) currently trades near recent averages relative to UAFRS-based (Uniform) Assets, with a 0.9x UAFRS-based P/B. At these levels, the market has muted expectations for the firm, but management is confident in their differentiated strategy, outlook for operating income and ITC extensionSpecifically, management is confident in their ability to pursue a differentiated strategy that can lead to capturing value and compelling returns. Additionally, they are confident in their outlook for operating income, and that their ITC extension may delay some of the utility ownership of solar, leading to a more optimal capital structure. Furthermore, they are confident that the reduction of approximately 200 megawatts to the full year Series 6 production plan was only due to their revaluation of their back-end processes. Given potential operational and market tailwinds, and the firm's leadership position in the space, longer-term upside remains warranted
First Solar is a provider of photovoltaic (PV) solar energy solutions. The company designs, manufactures and sells PV solar modules with a thin film semiconductor technology, and also develops and sells PV solar power systems that mainly use the modules it manufactures. The company also provides operations and maintenance (O&M) services to system owners. The company's modules segment involves the design, manufacture and sale of cadmium telluride solar modules, which convert sunlight into electricity. The company's second segment is its systems segment, through which it provides power plant solutions, which include project development, engineering, procurement, and construction services and O&M services.
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