Friedman Billings Ramsey downgraded First Solar Inc (FSLR.O: Quote) to "underperform" from "market perform," and said it is increasingly concerned about the margin risk as the thin-film solar equipment maker aggressively pursues utility-scale projects in the U.S.
Such risks are not reflected in the stock near $300 and thus not only could be a source of disappointment but could also lead to downside earnings per share risk, the brokerage said.
Friedman said with upside to its current revenue estimates on First Solar largely driven by additional facilities that have yet to be announced and thus uncertain, the current "rich" valuation multiples are not warranted....MORE