Value
7.3/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 5.2 |
| P/S | 7.0 |
| EV/EBITDA | 5.8 |
| Fwd P/E | 9.2 |
| PEG | 9.1 |
| Analyst target | 6.0 |
- ▸Forward P/E: 10.4x
- ▸PEG: 0.65
- ▸Attractively valued
FSLR · Why this verdict
Why First Solar (FSLR) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score6.1/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
A 24% year-over-year revenue growth rate and a near-perfect financial health score underpin the long-term quality case, but momentum below its minimum threshold, a 10% short float, and a leverage penalty on a debt-to-equity ratio of 5.9 create near-term headwinds that favor patience over adding exposure.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Revenue has grown 24% year over year, and three of the last four quarters delivered positive earnings surprises — most recently an 8.95% beat — indicating a business executing consistently above consensus expectations. Growth | Revenue growth sustains above 15% year over year and quarterly earnings surprises remain positive for at least three of the next four reported periods. | →Stable |
| CounterThe lone miss in the last four quarters (a 6.35% shortfall) shows guidance discipline can slip; if growth decelerates while leverage remains elevated, the valuation multiple could compress sharply. | ||
Operating and net margins stand at 31%, and the company's financial health scores 8 out of 9 on the Piotroski scale, placing it among the best-quality businesses in its peer set. Quality | Operating margins remain above 25% and the Piotroski financial health score stays at 7 or above over the next four reported quarters. | →Stable |
| CounterFree cash flow converts at only 69% of net income — flagged as a quality concern — meaning reported earnings overstate cash generation and the true capital-generation capacity is meaningfully weaker than headline margins imply. | ||
Price momentum has failed to clear the minimum required threshold, and 10% of the float is held short, creating a technical and positioning overhang that limits near-term appreciation even as the underlying business performs. Engine gate (failed) | Momentum recovers above the 4.5 threshold and short interest declines below 6% of the float within the next two to three quarters as continued earnings beats reduce short pressure. | →Stable |
| CounterSustained earnings beats could trigger short-covering that rapidly reverses the momentum deficit, making the current setup a contrarian opportunity rather than a structural warning. | ||
A debt-to-equity ratio of 5.9 carries a meaningful leverage penalty that offsets otherwise strong fundamentals and introduces financial risk if earnings come in below expectations. Bear case | Debt-to-equity ratio declines below 4.0 over the next four quarters as strong cash generation is applied to balance sheet reduction. | →Stable |
| CounterIf 24% revenue growth continues and free cash flow conversion improves, leverage could normalize naturally — removing the penalty and re-rating the stock toward a higher multiple without requiring external capital. | ||
Revenue has grown 24% year over year, and three of the last four quarters delivered positive earnings surprises — most recently an 8.95% beat — indicating a business executing consistently above consensus expectations.
→StableGrowth
- Expectation
- Revenue growth sustains above 15% year over year and quarterly earnings surprises remain positive for at least three of the next four reported periods.
CounterThe lone miss in the last four quarters (a 6.35% shortfall) shows guidance discipline can slip; if growth decelerates while leverage remains elevated, the valuation multiple could compress sharply.
Operating and net margins stand at 31%, and the company's financial health scores 8 out of 9 on the Piotroski scale, placing it among the best-quality businesses in its peer set.
→StableQuality
- Expectation
- Operating margins remain above 25% and the Piotroski financial health score stays at 7 or above over the next four reported quarters.
CounterFree cash flow converts at only 69% of net income — flagged as a quality concern — meaning reported earnings overstate cash generation and the true capital-generation capacity is meaningfully weaker than headline margins imply.
Price momentum has failed to clear the minimum required threshold, and 10% of the float is held short, creating a technical and positioning overhang that limits near-term appreciation even as the underlying business performs.
→StableEngine gate (failed)
- Expectation
- Momentum recovers above the 4.5 threshold and short interest declines below 6% of the float within the next two to three quarters as continued earnings beats reduce short pressure.
CounterSustained earnings beats could trigger short-covering that rapidly reverses the momentum deficit, making the current setup a contrarian opportunity rather than a structural warning.
A debt-to-equity ratio of 5.9 carries a meaningful leverage penalty that offsets otherwise strong fundamentals and introduces financial risk if earnings come in below expectations.
→StableBear case
- Expectation
- Debt-to-equity ratio declines below 4.0 over the next four quarters as strong cash generation is applied to balance sheet reduction.
CounterIf 24% revenue growth continues and free cash flow conversion improves, leverage could normalize naturally — removing the penalty and re-rating the stock toward a higher multiple without requiring external capital.
Per-dimension breakdown
Quality
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 6.2 |
| ROA | 5.7 |
| Gross margin | 4.8 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Current ratio | 8.6 |
| FCF quality | 6.6 |
| Moat | 5.9 |
| Piotroski F | 8.9 |
- ▸Strong margins: 32%
- ▸Strong Piotroski F-Score: 8/9
Growth
4.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 1.6 |
| EPS growth | 6.7 |
- ▸Declining revenue: -4%
Momentum
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.0 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 4.5 |
| Volume | 4.5 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope flat
Sentiment
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.5 |
| Analyst rating | 7.5 |
| Price target | 7.7 |
Insider
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 2.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Modest insider selling — $9,577,821 (0.037% of mkt cap)
- ▸Institutions accumulating
Peer rank
5.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.0 |
| quality rank | 8.3 |
| growth rank | 4.4 |
- ▸Best-in-class margins
Technical
4.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 4.0 |
| support resistance | 5.8 |
| 52w position | 4.1 |
Risk (lower is worse)
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 3.8 |
| days to cover | 5.1 |
| volatility | 0.0 |
| put call | 6.1 |
| implied vol | 3.5 |
| beta | 4.2 |
| debt equity | 9.9 |
Catalyst
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 7.0 |
| news activity | 8.0 |
- ▸Earnings concerns: 2B/2M
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (7)
- MOMENTUM:6.6>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:78d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:0.6<1.5@spot
Warning (0)
none
Reward-to-Risk
0.58
Upside
+7.9%
Downside
13.6%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.75>1.3
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:6.6>=5.5. Top dim: Quality at 7.4; weakest: Growth at 4.2. No conviction either direction.
The strongest dimensions are Quality at 7.4, Value at 7.3, and Sentiment at 7.2; the weakest are Growth at 4.2, Technical at 4.6, and Risk (lower is worse) at 4.7. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of 0.58 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Strong Revenue Earnings Growth
Trip ifRevenue growth falls below 15% YoY for 2 consecutive reported quarters.
- P2High Quality Margins Financial Health
Trip ifOperating margin compresses below 20% for 2 consecutive quarters.
- P3Momentum Short Interest Overhang
Trip ifShort interest falls below 5% of the float for 2 consecutive months.
- P4Leverage Drag On Fundamentals
Trip ifDebt-to-equity ratio falls below 3.0 for 2 consecutive quarters.