First Solar (NASDAQ:FSLR) beat Q209 earnings yesterday and the stock shot up in after hours trading cresting at around 190. But as the earnings conference call started and CEO Michael Ahearn and CFO Jens Meyerhoff spoke, the stock tumbled quickly.
What made folks nervous?
Cautious optimism? While Ahearn and Meyerhoff did not change guidance for the next quarter, they both spoke of challenges in balance of the year, which on the face of it was prudent and transparent. I like that about these guys; they are practical and forthcoming.
Yesterday's call, however, struck me as more dour than usual. And judging by the reactions, others seemed to agree.
The biggest concern moving forward appears to be the rather defensive position FSLR execs are taking in Germany, as polysilicon prices continue to fall making crystalline silicon (c-Si) module prices competitive with FSLR's cadmium telluride (CdTe) modules in Germany.
While this will affect their margins for some time to come, I'm still confident this company has real value, strong leadership, and a great product.
Analysts this morning have been all over the map, from CreditSuisse's downgrade to $135 (from $200) to Wedbush Morgan's upgrade price of $195 from $175. And it's been a bouncing ball all morning after opening at $155.
For me, I don't think the sun has set on First Solar just yet.
(Disclosure: I hold a long position in FSLR. This post is for informational purposes only and is neither intended to be investment advice nor an offer, or the solicitation of any offer, to buy or sell any securities.)