There is an interesting call after First Solar Inc. (NASDAQ: FSLR) blew past earnings expectations and guidance today. Lazard Capital Markets alternative energy analyst, Sanjay Shrestha, has reiterated his BUY rating on the stock. But his target has been raised to $300.00 from $350.00.
Shrestha noted that its output translates to a throughput increase to 45MW per line, up from 44MW in 4Q07, suggesting capacity of 1,035MW by year-end 2009.
He believes that First Solar has $6.4 billion of total volume to be shipped under long-term contracts and it additionally has a 7.5MW order with SCE in Blythe, California, pending CPC. Considering a factory cost ramp, efficiency/throughput gains, and lower cost/watt in Malaysia, Shrestha said he is raising 2008-2010 estimates.
This new $350 higher target represents a 40x multiple on recently raised 2010 estimates of $10.00, discounted back 15% for one year.
Interestingly enough, Shrestha’s target of $350 is well under some other analyst targets out there.
Jon C. Ogg
April 30, 2008