First Solar Skyrockets; Raising Sector

Jacob Harper |

Shares of American solar panel manufacturer First Solar (FSLR) shot up drastically on March 19 on exuberant guidance, bringing several other solar plays into the black. While there is little reason for solar companies, no matter how disparate, to move in tandem, they often do.

First, the goods on First Solar: the company now expects full year earnings between $2.20 and $2.40 a share, and between $4.50 and $6.00 in 2015. Revenue for 2014 was also ratcheted up, with internal estimates pegging it at between $3.7 and $4 billion for the year. Coupled with the optimistic guidance was announced lucrative deals with General Electric (GE) and the nation of Jordan, representing a crucial break into an emerging solar-adopting market.

On an overall down day for stocks, this news was enough to prop up nearly every major solar play. SunPower (SPWR) , Canadian Solar (CSIQ) and Trina Solar (TSL) all notched gains on the day.

A notable entry not invited to the party was Elon Musk’s SolarCity (SCTY) , which sunk 6 percent on the day. SolarCity’s price was still adjusting to the weak guidance the company issued after the bell the day prior, which caused the company's shares to retreat from the highs it hit the week before.

If SolarCity’s slightly disappointing news threatened to pull the solar monolith one way, First Solar’s incredibly positive news pulled it the other way that much more. The difference in the performance of the two stocks on the day is especially interesting in light of First Solar’s intention to expand into the residential rooftop solar panel market, a market currently dominated in the US by SolarCity.

First Solar recorded one of their better days in the company’s history, and near the end of trading had gained 20.71 percent to hit $69.49 a share. 29.5 million shares traded hands on the day, which was almost six times more than normal.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
TSL Trina Solar Limited Sponsored ADR (Cayman Islands) 9.82 0.01 0.10 1,625,180
SPWR SunPower Corporation 7.65 0.06 0.79 2,880,793
SCTY SolarCity Corporation n/a n/a n/a 0
CSIQ Canadian Solar Inc. 12.78 0.13 1.03 1,279,339
DCHKQ Daiichi Chuo Kisen Kaisha n/a n/a n/a 0

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