Will First Solar, Inc (NASDAQ:FSLR) be able to rid on Cash wave alone?
First Solar Inc (NASDAQ:FSLR) has been facing very stiff competition. But the company will be able to create an economically-sustainable business by focusing on the development of meaningful Photovoltaic-generation solutions in other avenues such as EPC capabilities, project development as well as O&M services. The company’s solar-cells cannot convert sunlight into electricity as efficiently as traditional silicon PV modules can.
The Company’s USP
But the one advantage that thin PV cells have is that they can produce electricity in low-light conditions. This is the USP of First Solar, Inc (NASDAQ:FSLR)’s solar cells. They are a perfect solution for companies that need utility-sized, large-scale renewable energy production. The company has a very strong balance-sheet and a 4.7% debt to equity ratio. It has $928.7M in cash and its cash reserves are what give it an upper hand over its peers whose coffers are almost empty.
Despite all these positives, analysts are concerned about the volatility that the euro has been displaying for quite some time now. Apart from that there is apprehension over the German subsidies that might be cut-back and there is an excess of solar-module supply in the market. There is a distinct imbalance in the booming production capacity and the current and future potential demand for solar cells. This is what will eventually pressurize pricing and affect the company’s results through the rest of this year and into 2014 as well. In the Q2, First Solar, Inc (NASDAQ:FSLR) posted very weak results that were attributed to the lower revenue-recognition from its AVSR project.
Thursday’s trading session
In Thursday’s trading, First Solar, Inc (NASDAQ:FSLR) rose by 0.23%. The shares opened at a price of $43.65, climbed to an intraday high of $44.25 and dipped to a close of $43.08. Approximately 6.34 million shares were traded on Thursday while an average volume of 3.62 million shares were traded over a 30 day period. The 52-week low of the company’s shares is $19.68 and its 52-week high is $59.00. The company has a market capitalization of $4.21 billion