Stock Analysis & Valuation First Solar, Inc. (FSLR.SW)

• Previous Close: CHF58.00
• Sector Valuation Confidence Level: Low

Valuation method	Value, CHF	Upside, %
Artificial intelligence (AI)	n/a	n/a
Intrinsic value (DCF)		n/a
Graham-Dodd Method	81.20	40
Graham Formula	209.50	261

Strategic Investment Analysis

Company Overview

First Solar, Inc. (FSLR.SW) is a leading global provider of photovoltaic (PV) solar energy solutions, specializing in the design, manufacture, and sale of cadmium telluride (CdTe) solar modules. Headquartered in Tempe, Arizona, and listed on the Swiss Exchange (SIX), First Solar serves a diverse clientele, including utilities, independent power producers, and commercial and industrial entities across the U.S., Japan, France, Canada, India, and Australia. Founded in 1999, the company has established itself as a pioneer in thin-film solar technology, offering high-efficiency, low-cost modules with a strong environmental profile. Operating in the competitive semiconductor sector within the broader technology industry, First Solar differentiates itself through its vertically integrated manufacturing process and focus on sustainability. With a market capitalization of CHF 6.21 billion, the company plays a critical role in the global transition to renewable energy, leveraging its advanced PV technology to meet growing demand for clean energy solutions.

Investment Summary

First Solar presents a compelling investment opportunity due to its strong position in the solar energy market, backed by innovative CdTe technology and a vertically integrated business model. The company reported robust FY 2023 financials, with revenue of CHF 3.32 billion and net income of CHF 830.8 million, reflecting a diluted EPS of CHF 7.74. Despite significant capital expenditures (CHF -1.39 billion), First Solar maintains a solid balance sheet with CHF 1.95 billion in cash and equivalents and manageable total debt of CHF 624.4 million. However, investors should note the company's high beta (1.478), indicating higher volatility relative to the market. The lack of dividends may deter income-focused investors, but growth-oriented investors may find value in First Solar's technological edge and expanding global footprint in the renewable energy sector.

Competitive Analysis

First Solar's competitive advantage lies in its proprietary CdTe thin-film solar technology, which offers lower production costs and higher efficiency in high-temperature and low-light conditions compared to traditional crystalline silicon (c-Si) panels. The company's vertically integrated manufacturing process allows for greater quality control and cost efficiencies, positioning it favorably against competitors reliant on outsourced production. First Solar also benefits from strong brand recognition and long-term contracts with utilities and large-scale solar project developers. However, the company faces intense competition from Chinese manufacturers like JinkoSolar and LONGi, which dominate the global c-Si market with economies of scale. Additionally, First Solar's reliance on CdTe technology, while advantageous in certain climates, may limit its market share in regions where c-Si panels are preferred. The company's focus on sustainability and ESG compliance further strengthens its appeal to environmentally conscious investors and customers, but it must continue innovating to maintain its technological lead amid rapid advancements in solar efficiency and storage solutions.

Major Competitors

• JinkoSolar Holding Co., Ltd. (JKS): JinkoSolar is a global leader in crystalline silicon solar modules, known for its high-efficiency products and massive production scale. The company benefits from lower manufacturing costs due to its Chinese base but faces geopolitical risks and trade barriers. Compared to First Solar, JinkoSolar's c-Si technology is more widely adopted but less efficient in high-temperature environments.
• LONGi Green Energy Technology Co., Ltd. (LONG.L): LONGi is the world's largest monocrystalline solar wafer producer, with a strong focus on R&D and vertical integration. Its products are highly efficient but compete directly with First Solar's CdTe modules in utility-scale projects. LONGi's dominance in c-Si gives it cost advantages, but it lacks First Solar's differentiation in thin-film technology.
• Canadian Solar Inc. (CSIQ): Canadian Solar is a diversified solar player with significant manufacturing and project development capabilities. It offers both c-Si and thin-film modules, competing with First Solar in utility and commercial markets. While less vertically integrated than First Solar, Canadian Solar's global presence and project pipeline provide stability.
• SunPower Corporation (SPWR): SunPower specializes in high-efficiency c-Si solar panels for residential and commercial markets, differentiating itself with premium products. Unlike First Solar, it focuses on distributed generation rather than utility-scale projects. SunPower's technology is superior in efficiency but comes at a higher cost, limiting its competitiveness in large-scale deployments.