First Solar: 21% 5-Year EPS Growth for 11x Forward Earnings

FSLR (hold): Held for 1.5+ years and continuing to hold; at $225.56 the stock sits 18% below the author's Bear Case fair price of $274 and inside the $192-274 accumulation zone. Q2 2026 (ended June 30): EPS $3.92 beat consensus by 43.1% and rose 23.3% YoY, gross margin expanded ~12 points to 57% for the quarter, adjusted EBITDA up 15%, even as net sales fell 3.7% YoY to $1.06B (missed by 0.4%); contracted backlog 45.1GW/$13.6B through 2030, US production substantially booked through 2028. LTM: gross margin 44.0%, net margin 32.5%, ROIC 16.5%, FCF $1.5B, net cash ~$1.5B. Trades at 10.8x forward earnings, PEG 0.51, 9.3% forward earnings yield; consensus 5Y EPS growth 21.3%, the highest and cheapest growth-adjusted multiple among still-growing solar-equipment competitors. Down 14% YTD on flat-to-down 2026 top-line guidance ($4.9-5.2B), a $60-80M net tariff assumption, a pending Section 232 investigation affecting ~1.8GW of Southeast Asia capacity, and 2026 profitability built on $2.10-2.19B of Section 45X credits. Author calls it no-moat, policy-levered, sized like a cyclical industrial; base case $373, bull $498; DCF value $205.

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