First Solar
| CURRENT PRICE | PROBABILITY-WEIGHTED FAIR VALUE | FAIR VALUE RANGE |
|---|---|---|
| $211.03 | ~$250 | $155 – $320 |
| Jul 31, 2026 close — confirm on live feed | House view: Constructive (quality solar) | Q2 EPS $3.92 (+23%); guide reaffirmed |
July 2026 update: First Solar reported Q2 2026 after the close on July 30, 2026. Figures below are verified against the company's SEC Form 8-K (Item 2.02) earnings release[1]; analyst actions and estimate beats/misses are from Benzinga Pro[3].
Verdict: Still the highest-quality solar pure-play, and Q2 confirmed it. Net sales were $1.06B (−4% YoY on customer contract terminations), but earnings quality improved sharply: net income $423M, diluted EPS $3.92 (+23% YoY) — well ahead of the ~$2.86 consensus, though revenue was a hair light versus the ~$1.06B estimate — Adjusted EBITDA $644M at a 61% margin (57% GAAP gross margin), and the company reaffirmed full-year guidance of $4.9–5.2B revenue and $2.6–2.8B Adjusted EBITDA. The stock traded up ~4% on the print. First Solar surpassed 100 GW of cumulative module sales and carries a 45.1 GW contracted backlog extending through 2030 — multi-year visibility that peers can't match. The moat is structural: US-onshored thin-film manufacturing outside the Chinese crystalline-silicon supply chain, and large Section 45X tax credits ($2.1B+ assumed in guidance). The swing factor is policy — the IRA/45X regime as amended by the 2025 tax law — which is exactly what defines the downside case. At $211 (~14–15x FY26E EPS of ~$15) the stock is reasonable for a grower with this visibility; our ~$250 base is roughly in line with the ~$249 Street consensus, with a wide $155–$320 range bracketing a policy shock against continued execution.
CURRENT SNAPSHOT
| Metric | Value | Notes / Source |
|---|---|---|
| Stock price | $211.03 | Jul 31, 2026 close; up on Q2 beat [4] |
| Market cap | ~$22.7B | ~107.5M shares × $211 [1] |
| Net cash balance | $1.7B | Down from $2.4B on working capital/capex [1] |
| Diluted shares | ~107.5M | 107.5M issued/outstanding [1] |
| Q2 2026 revenue | $1.06B (−4% YoY) | Customer contract terminations [1] |
| Q2 2026 Adj EBITDA | $644M (61% margin) | 57% GAAP gross margin [1] |
| Q2 2026 diluted EPS | $3.92 (+23% YoY) | Net income $423M [1] |
| Contracted backlog | 45.1 GW | Through 2030; >100 GW cumulative shipped [1] |
| FY26 revenue guide | $4.9B – $5.2B | Reaffirmed [1] |
| FY26 Adj EBITDA guide | $2.6B – $2.8B | Q3 Adj EBITDA guide $625–775M [1] |
| Forward P/E | ~14–15x FY26E EPS | FY26E EPS ~$15 (H1 already $7.14) |
| Consensus PT | ~$249 (Buy) | 33 analysts; range $150–$330 [3] |
MACRO CONTEXT — RATES & MARKET LEVELS
US utility-scale solar deployment continues at record pace, supported by IRA tax credits and AI data center power demand. 10-yr UST at 4.68%[7] pressures cap rates for solar developers but does not directly hit FSLR's module-sale margins. S&P at 21x forward[8] provides relative-value contrast. Implication for FSLR: FSLR's 45.1 GW contracted backlog (through 2030) and Section 45X credits provide multi-year revenue visibility that no other module maker can match. The main risk is not demand or execution — it is policy: any adverse change to the IRA/45X regime would hit both the credit stream and end-market economics.
METHODOLOGY
Primary lens is P/E on FY26E EPS (~$15, with H1 already $7.14), cross-checked against EV/EBITDA on the reaffirmed $2.6–2.8B FY26 Adjusted EBITDA and a FY27 growth case. Net cash $1.7B; shares ~107.5M. The scenarios are driven mainly by the FY27+ policy and pricing environment and the multiple the market assigns to that visibility. Weights: Bull 25% / Base 50% / Bear 25%.
BULL / BASE / BEAR SCENARIOS
| Scenario (weight) | Driver | Approx. multiple | Fair value |
|---|---|---|---|
| Bull (25%) | Policy stable, ASPs/pricing firm, backlog converts and FY27 EBITDA grows toward $3.1B+ | ~21x FY26E EPS | ~$320 |
| Base (50%) | Hit reaffirmed FY26 guide, modest FY27 growth, current policy persists | ~17x FY26E EPS | ~$255 |
| Bear (25%) | IRA/45X regime weakens, ASP pressure and module oversupply compress margins and the multiple | ~10x FY26E EPS | ~$155 |
| Probability-weighted | — | — | ~$250 |
Probability-weighted fair value ~$250, roughly in line with the ~$249 Street consensus and ~18% above the $211 tape. Range $155–$320 is deliberately wide because the swing variable is US clean-energy policy, not First Solar's execution — the backlog, balance sheet and 45X credit stream give the base and bull cases real support, while a policy reversal defines the bear.
PEER COMPARISON
| Company | Fwd P/E | Rev Growth | Notes |
|---|---|---|---|
| First Solar (FSLR) | ~11x | +24% Q1 | Utility-scale; Section 45X; net cash [2] |
| Enphase (ENPH) | ~14x | -21% Q1 | Residential; profitable but declining |
| SolarEdge (SEDG) | n/m → 22x | +46% Q1 | Turnaround; high beta |
| NextEra (NEE) | ~22x | +8% | Utility/IPP; project developer |
| Brookfield Renewable | ~25x | +10% | Project portfolio; yield component |
| Jinko / LONGi (China) | ~6-8x | varies | Asian competitors; ASP pressure |
FSLR's 11x forward P/E is anomalously low for a US-onshored manufacturer with 25%+ growth and 50%+ gross margins. The discount reflects: (1) ASP risk from Chinese oversupply, (2) policy uncertainty on Section 45X credits, and (3) limited resi exposure. Each of these is a real risk but the cash generation already locks in significant value.
Key Risks & Watch Points
- ASP risk: Module pricing remains pressured; India deliveries at ~$0.20/W reflect mix risk.
- Section 45X credit: Policy reversal or modification would materially impact economics.
- Customer concentration: Backlog concentrated in handful of large utility customers; pushouts can lump revenue.
- Trade/tariff: Chinese module dumping cases and trade policy whiplash.
- Technology: Thin-film vs. crystalline silicon efficiency gap; ongoing R&D risk.
- Working capital: Long manufacturing cycle ties up cash even with strong P&L.
What Would Change Our View
- Upside: FY26 guide raise, Section 45X clarity, ASP stabilization, AI data center demand catalysts for utility solar.
- Downside: FY26 guide cut, ASP collapse, Section 45X reduction, major backlog cancellation, China module surge.
Sources
[1] SEC Form 8-K (Item 2.02), First Solar Q2 2026 earnings release, filed Jul 30, 2026 — sec.gov/Archives/…/ex991pressreleaseq2-2026.htm
[2] https://stockanalysis.com/stocks/fslr/statistics/
[3] Benzinga Pro — First Solar news feed & analyst actions (Q2 EPS $3.92 beat $2.86 est, rev $1.056B vs $1.062B est; FY26 sales guide $4.9–5.2B reaffirmed vs $5.118B est; post-print PTs: Wells Fargo Overweight $300, Roth Buy $300, Truist Hold $229, Bernstein Underperform $197) — pro.benzinga.com
[4] https://finance.yahoo.com/quote/FSLR/
[6] https://www.gurufocus.com/term/enterprise-value-to-ebitda/FSLR
[7] https://fred.stlouisfed.org/series/DGS10
[8] https://insight.factset.com/sp-500-earnings-season-update-may-8-2026
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