Phase Space AI

Criteria

First Solar [FSLR]

First Solar [FSLR] — Criteria Scorecard

As of 2026-07-29 · framework: Criteria, 2026-07-29 · price at memo $202.59

This is an analysis, not a position. The memo scores every Criteria and blocks on none of them. No Long / Short / Watchlist / Avoid verdict is issued. Every Criteria returns PASS / FAIL / INDETERMINATE; a missing input is INDETERMINATE, never FAIL.

Criteria Type Result Basis
Quality BINDING FAIL Archetype recorded as COMPOUNDER on reported figures. ROIC on product operating income is negative: TTM product EBIT −$2.8m against $5,666m net PP&E and $9,879m equity. The only evidenced capital-redeployment mechanism (build US capacity → earn more §45X) is a claim on a statute that phases down from 2030 and is unavailable after 2032. Accruals/earnings quality: no misstatement — the credit is cash, monetised at 95–96c — but 100.2% of TTM operating income is a government grant. Cheap cannot rescue a failure here.
Valuation BINDING FAIL Implied-path test: required 5y revenue CAGR 33.2% vs demonstrated 25.8%, margin −7.4pp, at terminal margin 9.05% (best-ever product operating margin) and exit multiple 15.5x (p50 of FSLR's own post-45X EV/EBIT history; implied compression from today's 11.5x is +4.0 turns of expansion, not compression). No exit multiple in the observed 8.4x–28.5x range makes the path achievable below the 93rd percentile. Sensitivity run over the exit multiple.
Downside MEASURED Logged — does not block Named cause: US utility-scale demand cliff from OBBBA's accelerated §48E/§45Y termination. Dated trigger: ~2026-07-04 begin-construction deadline, already passed. Permanent-loss scenario: reversion to ~7% product gross margin against ~$620m opex ⇒ structurally loss-making, $5.67bn of PP&E impaired. Implied equity $100–130 (−36% to −51%). Probability 25%. Not a going-concern case — $426m debt vs $2,427m gross cash.
Liquidity BINDING PASS 63-day ADV $594m; median 2.07m shares/day. A $10m position is ~1.7% of one day's dollar volume. Options chain pulled and verified: Jan-2027 $180 put OI 9,025, bid/ask $21.98/$24.82, quoted size 243×206; $150 put OI 10,070. Every structure proposed in the Trade Construction doc is quoted with real size.
Momentum MEASURED INDETERMINATE 12-1 momentum computed: +28.0% (2025-07-29 → 2026-06-29). The Criteria require a cross-sectional percentile against a broad universe; no universe was pulled in this run. Recorded INDETERMINATE rather than substituting an absolute rule such as "above the 200-day". Context: −36.5% from the 52-week high of $318.25; 252-day realised vol 53.8%.
Catalyst MEASURED PASS Q2 2026 results (unannounced but on a four-year late-July cadence); FY2026 guidance revision risk; USITC 337-TA-1494; the post-safe-harbour bookings read. See the Catalyst Calendar.
Consensus MEASURED INDETERMINATE Alpha Vantage shared 25/day quota exhausted (API returned the rate-limit message). No Street NTM revenue/EPS, analyst count or revision history. Blocks nothing.
Short Mechanism MEASURED PASS (scored, acted on by nothing on this fork) Both legs present. Decelerating growth: FY2025 +24.1% → FY2026 guided −0.4% to −6.1%; backlog −34.2% in six quarters; annual net bookings 48.3 GW (2022) → 4.4 GW (2024). Exhausted margin runway: reported operating margin already 31.8% and already expanded; incremental leverage visibly spent — product operating margin has gone +9.05% (FY2024) → −0.24% (FY2025) → −5.3% (FY2026 guided) while the reported margin rose.
Peer Spread MEASURED INDETERMINATE No named peer with a comparable margin structure exists — the crystalline-silicon module makers carry no equivalent credit and are loss-making at the operating line. Declared unidentified rather than defaulted to a sector median.
Sub-sector MEASURED Not on taxonomy The reference taxonomy (LC MedTech, SMID Growth, Genomics/Dx, Pharma, Labs, LC Tools, HCIT, Services, SMID Other) is healthcare-only and has no bucket for a solar-equipment manufacturer. Recorded as Industrials / Clean-Energy Equipment (off-taxonomy) and logged as a taxonomy gap.

Key numbers
Price at memo $202.59 (2026-07-28 close)
Market cap $21,769m
Enterprise value $19,768m (screen said $19,134m)
TTM revenue $5,419.0m
EV / Sales 3.65x (screen said 3.53x)
EV / reported EBIT 11.5x — 12th percentile of own post-45X history
Trailing P/E 13.1x — 10th percentile of own post-45X history
§45X ÷ TTM operating income 100.2%
§45X ÷ FY2026 guided operating income 114.2%
Product operating margin, TTM −0.05%
Contracted backlog 47.9 GW / $14.4bn at 2026-03-31 (−34.2% in six quarters)
Backlog ASP ~30.1 c/W — flat since 2024-09-30
Backlog coverage vs FY2026 guided volume 2.7 years (vs a book running "through 2030")
Required 5y CAGR (product margin) 33.2%
Demonstrated CAGR 25.8% (FY2026 guided negative)
Margin (demonstrated − required) −7.4pp
12-month target $235 (+16.0%)
Downside case $100–130 (−36% to −51%), 25% probability, named cause + dated trigger

Disclosed limitations

  1. Consensus estimates unavailable (quota) — Consensus Criteria INDETERMINATE.
  2. Cross-sectional momentum percentile not computed — Momentum Criteria INDETERMINATE.
  3. Q2 2026 results unreported; the first quarter falling entirely after the ~2026-07-04 safe-harbour deadline is Q3 2026, which will not be reported until ~late October 2026.
  4. USITC 337-TA-1494 target date not disclosed in any FSLR filing — recorded UNKNOWN, not estimated.
  5. Q1 2026 GW volume sold is not disclosed; the ~3.6 GW shipped and ~0.4x book-to-bill are my derivations.
  6. §45X phase-out percentages (75/50/25 for 2030/31/32) are from IRC §45X(b)(3), not from FSLR's filings.
  7. H1 2027 EPS of $6.10 inside the NTM base is my estimate, not company guidance and not consensus.
  8. No external professional price target obtained; the valuation.md sanity-band check was not run.
  9. The reference sub-sector taxonomy has no bucket for this name.