What Happened?
Shares of solar panel manufacturer First Solar (NASDAQ:FSLR) jumped 5.1% in the afternoon session after an analyst at Jefferies raised the price target for the company. The firm boosted its price target on First Solar to $194 from $192, while keeping a "Buy" rating on the shares. This move signals confidence in the company's future performance.
Adding to the positive sentiment, RBC Capital also recently increased its price target to $200, citing potential for increased demand. Analysts at Jefferies noted that while concerns about tariffs and the Inflation Reduction Act have weighed on market estimates, they anticipate that clarity on these issues will lead to higher sales volumes in 2026. The firm projects that First Solar's revenue and core earnings for 2025 will surpass current market expectations. However, not all analysts were as bullish. Barclays lowered its price target to $216 from $222, though it maintained an "Overweight" rating, expecting a quiet upcoming earnings report.
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What Is The Market Telling Us
First Solar’s shares are extremely volatile and have had 34 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 7 days ago when the stock dropped 5.5% on continued weakness in the clean energy sector driven by concerns over new tariffs and changes to government subsidies.
The slide in clean energy stocks, including First Solar, occurred as investors weighed the impact of President Trump's announcement of new tariffs ranging from 25% to40% on 14 countries. Although the start date was moved to August 1, the policy creates uncertainty for solar panel importers.
Adding to investor concerns, a new domestic policy bill is expected to end key subsidies for the clean energy sector. This combination of potentially higher costs from tariffs and the removal of government financial support is pressuring the outlook for solar companies.
First Solar is down 9.3% since the beginning of the year, and at $169.05 per share, it is trading 33.9% below its 52-week high of $255.75 from September 2024. Investors who bought $1,000 worth of First Solar’s shares 5 years ago would now be looking at an investment worth $2,772.
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