Wednesday, March 19, 2014

One of Our Speculation Indicators Was Up 20% Today

$69.40 last up 20.57%. FSLR is one of a half-dozen issues we watch for signs of investor risk appetite.
From MarketWatch:

First Solar soars to 2 1/2-year high on earnings guidance
First Solar’s Desert Sunlight Solar Farm in Calif.

First Solar Inc. shares soared to their highest level since September 2011 on Wednesday as investors applauded better-than-expected earnings guidance and early success in its strategic switch to large-scale power plants.

First Solar said its recent partnership with General Electric Co. has started to bear fruit: The two companies will cooperate to develop a cheaper and more efficient utility-scale solar power plant design.
Shares recently were up 21% to $69.22,  adding to earlier gains. The stock hit a record high of $311.14 in May 2008.

(Update: the closing price of $69.40 a share was the highest for First Solar since Sept. 27, 2011, and volumes were the highest since April.)

Shares of First Solar have climbed 26% so far this year and 149% in the past 12 months. Wednesday’s enthusiasm also boosted trading volume: Shares changed hands at the fastest clip since November.

First Solar has pivoted to developing large-scale solar plants and away from manufacturing solar panels, where margins have shrunk. Earlier Wednesday, it said it expects full-year earnings between $2.20 and $2.60 a share, and between $4.50 and $6 in 2015. Net sales for 2014 will reach as much as $4 billion, it added.

The company reported earnings of $3.70 a share and sales of $3.3 billion in 2013.
The partnership with GE, announced last year, had some analysts skeptical, said Shyam Mehta, a solar analyst with GTM Research — himself included. Wednesday’s announcement, however, shows it was valuable for First Solar, as a less-expensive utility-scale solar power plant design gives the company a competitive edge, he added....MORE
From First Solar, Inc:

First Solar, Inc. (FSLR) today announced full-year 2014 guidance as well as summary financial targets through 2016.
For 2014, First Solar expects net sales of $3.7 to $4.0 billion. Consolidated gross margin is expected to be between 16 and 18 percent. Diluted earnings per share is expected to be between $2.20 and $2.60, and consolidated operating income is expected to be between $270 and $320 million. The Company expects to generate between $250 to $450 million of operating cash flow and plans for approximately $300 to $350 million in capital expenditures in 2014.
In addition to the 2014 detailed guidance, the Company also provided a summary outlook for 2015 and 2016 as follows:
    2015 Target   2016 Target
Net Sales $3.8 to $4.3Billion $3.8 to $4.5Billion
Earnings Per Fully Diluted Share $4.50-$6.00 $3.50-$5.00
Operating Cash Flow $300 to $600Million $800Million to $1.3Billion
First Solar’s Chief Financial Officer, Mark Widmar provided the guidance and outlook during the company’s 2014 Analyst Day event held today in New York. Additionally, company executives discussed First Solar’s strategic goals and technology advances. A replay of the webcast and presentation materials can be accessed by visiting