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First Solar (FSLR) Stock Drops Despite Market Gains: Important Facts to Note

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First Solar (FSLR - Free Report) closed the most recent trading day at $209.96, moving -0.72% from the previous trading session. The stock fell short of the S&P 500, which registered a gain of 0.77% for the day. Meanwhile, the Dow gained 0.47%, and the Nasdaq, a tech-heavy index, added 0.87%.

Shares of the largest U.S. solar company have depreciated by 7.56% over the course of the past month, underperforming the Oils-Energy sector's loss of 1.87% and the S&P 500's gain of 4.87%.

The investment community will be paying close attention to the earnings performance of First Solar in its upcoming release. The company is slated to reveal its earnings on October 29, 2024. In that report, analysts expect First Solar to post earnings of $3.24 per share. This would mark year-over-year growth of 29.6%. Simultaneously, our latest consensus estimate expects the revenue to be $1.11 billion, showing a 38.74% escalation compared to the year-ago quarter.

For the full year, the Zacks Consensus Estimates are projecting earnings of $13.50 per share and revenue of $4.47 billion, which would represent changes of +74.42% and +34.6%, respectively, from the prior year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for First Solar. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.78% downward. First Solar is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, First Solar is currently trading at a Forward P/E ratio of 15.67. For comparison, its industry has an average Forward P/E of 14.3, which means First Solar is trading at a premium to the group.

Also, we should mention that FSLR has a PEG ratio of 0.36. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. As of the close of trade yesterday, the Solar industry held an average PEG ratio of 1.85.

The Solar industry is part of the Oils-Energy sector. At present, this industry carries a Zacks Industry Rank of 166, placing it within the bottom 35% of over 250 industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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