Company Overview
First Solar, Inc. operates as a solar technology provider that manufactures and sells photovoltaic (PV) solar modules utilizing thin film semiconductor technology to deliver energy solutions across the United States, France, India, Chile, and internationally. The company functions within the Technology sector, specifically in the Solar industry, positioning it as a key player in the renewable energy landscape focused on generating electricity through light exposure. As of the latest reporting period, the enterprise holds a market capitalization of $21.42B and reported total revenue of $5.22B for the trailing twelve months, while employing a workforce of 7900 individuals. These valuation and revenue figures indicate that First Solar has established significant scale and market presence, suggesting a substantial operational footprint capable of delivering widespread photovoltaic solutions globally.
Financial Health
The company reported revenue of $5.22B, net income of $1.53B, and EBITDA of $2.13B, illustrating a robust operational performance where operating earnings significantly exceed reported profits. The gap between the $5.22B revenue and the $1.53B net income reveals a cost structure that retains approximately 29.3% of sales as profit, reflecting the high efficiency inherent in its manufacturing processes. First Solar generated $963.92M in free cash flow, a metric that underscores its strong financial flexibility to fund capital expenditures, repay debt, or pursue strategic acquisitions without relying heavily on external financing. The company maintains a gross margin of 40.6%, an operating margin of 32.6%, and a profit margin of 29.3%, indicating that it effectively controls production costs and converts a large portion of sales into operating income before taxes. Regarding liquidity and leverage, the firm holds $2.86B in cash against $655.33M in debt, resulting in a conservative debt-to-equity ratio of 6.87, although the ratio itself is high, the absolute debt burden is well covered by available cash reserves. The current ratio stands at 2.67, signaling a highly liquid balance sheet where current assets are more than double current liabilities, ensuring the ability to meet short-term obligations comfortably. Return on Equity is 17.4% and Return on Assets is 7.8%, metrics that demonstrate management effectiveness in generating returns for shareholders relative to the equity invested and the total asset base utilized.
Valuation Assessment
Valuation metrics for First Solar include a trailing twelve-month P/E ratio of 14.04 and a forward P/E of 7.92, implying that the market expects earnings to grow significantly faster in the coming year than they have historically. The difference between the 14.04 trailing P/E and the 7.92 forward P/E suggests that analysts project a substantial expansion in profitability that will compress the multiple over time. The price-to-book ratio is 2.25, indicating that the stock trades at a premium of roughly 125% over its book value, which may reflect investor confidence in the company's intangible assets and future growth potential. Alternative valuation measures such as a price-to-sales ratio of 4.10 and an EV/EBITDA of 9.04 provide context, showing the company is valued at roughly 4 times its sales and 9 times its earnings before interest, taxes, depreciation, and amortization. In terms of trading range, the 52-week high is $285.99 and the 52-week low is $116.56, meaning the current price sits significantly closer to the low end of this historical range compared to the high. The beta value is 1.65, which indicates that the stock is expected to be 65% more volatile than the broader market, reflecting higher sensitivity to market swings.
Growth & Income
Growth dynamics are highlighted by a revenue growth rate of 11.1% year-over-year and an earnings growth rate of 32.3% year-over-year, demonstrating that earnings are expanding at a rate nearly three times faster than sales. This divergence implies that the company is successfully leveraging its revenue base to drive disproportionate profit growth, likely through operational leverage or pricing power. As a non-dividend payer, First Solar reports a dividend yield of N/A and a payout ratio of 0.0%, meaning the company reinvests all of its net income back into business growth rather than distributing cash to shareholders. The overall growth and income profile characterizes First Solar as a capital-light, high-growth equity that prioritizes expansion and reinvestment over current income generation for investors.