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First Solar Fiasco: For Investors Only 1 Question Matters

NEW YORK ( TheStreet) -- First Solar (FSLR - Get Report) is down 25% one day -- the largest one-day drop in its history -- and up by as much as 15% the next, but for any investor who hopes to understand the future of the solar sector, neither Tuesday's First Solar share collapse or Wednesday's rebound makes one bit of difference in the end.

First Solar shares may yet go lower than they are after Wednesday's rally, and even lower still than after Tuesday's historic collapse. And there is only question that matters for investors, that is, investors who think in more than flash-trading intervals, because for day traders and the HFT terminals, the volatility and mercenary, millisecond profit opportunities will continue: What is the earnings power of First Solar in 2013?

That's it. It's really that simple.

That's not to say there aren't a million questions to ask -- for which the company won't provide any clear answers -- based on the fiasco of the past 24 hours during which the company ousted its CEO in a rare intraday press release, said it would announce third-quarter results on Nov. 3, and then reported the results -- without details -- on Wednesday morning. On this one, First Solar looks like it didn't have a clue how to run a corporation to reduce market volatility, even though it said the past 24 hours show it's getting its house in order.

The financial guidance from First Solar was significantly below Wall Street expectations -- though to be fair, any Street analyst who was significantly higher with their model than First Solar's new guidance had his head in the sand.

After disposing of its CEO Rob Gillette, First Solar announced that it earned $2.25 a share in the third quarter, below the Wall Street consensus of $2.64. The solar company reduced its full-year guidance to $6.50 to $7.50 a share, down from $9 to $9.50.

Neither the third-quarter results or the revised full-year guidance matter. If you believe the bulls that the relief rally in First Solar shares on Wednesday is a sign that things aren't as bad as feared, you're buying a song and dance.

Here's the truth: Solar is "utterly uninvestable" at the moment, in the words of analyst Paul Leming of Ticonderoga Securities.

So here are some of the questions that we can skip trying to answer before getting to the only question that matters about First Solar's future earnings power:
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