November 26, 2018

FSLR – While market expectations for FLSR are currently pessimistic, management is confident about their outlook, costs, and Series 6 Model, suggesting upside remains warranted


  • First Solar, Inc. (FSLR:USA) currently trades at a discount to UAFRS-based (Uniform) Assets, with a 0.7x UAFRS-based P/B. At these levels, the market has muted expectations for the firm, but management is confident in their long-term outlook, operational costs, and new Series 6 model
  • Specifically, management is confident in their focus to put FSLR in the strongest position possible for 2021, and that their solid financial results in Q3 were driven by the closure of several project sales. Additionally, they are confident in their ability to meet lowered operating expense forecasts, and that they have a 10% bookings premium on their Series 6 product over the Series 4. They are also confident in their ability to drive their contribution margin by scaling production of their Series 6 model, and that their module segment COGS is comprised of both Series 4 COGS and Series 6 ramp-related costs
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