First Solar Tops Q3 Estimates: What Wall Street's Saying

First Solar jumped double digits Wednesday after topping analysts' third quarter estimates.
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First Solar  (FSLR) - Get Report is one of the few equities trading in the green Wednesday, climbing double digits as a couple of analysts issued bullish calls following the release of the company's third quarter earnings results. 

The Tempe, Arizona-based solar energy company jumped 11.4% to $91.77 in morning trading Wednesday. The company posted adjusted earnings per share of $1.45 on revenue of $928 million. The company had been expected to report adjusted earnings of 63 cents a share on sales of $676.5 million, based on a FactSet survey of 13 analysts.

Here's what Wall Street was saying about the stock:

Morgan Stanley (Equal Weight rating unchanged, $40 PT unchanged)

FSLR provided a constructive update, showing improved margins and reissuing constructive 2020 guidance. However, we continue to view FSLR as exposed longer-term to heightened competition, and think it faces some risks even in the event of a Democratic sweep in next week's election.

Revenue beat driven by the sale of previously delayed projects in Japan and India, as well as increased series 6 module sales to 3rd parties. Gross Margin beat attributed to aforementioned project sales, and one-time reductions to liability accounts that were a benefit to cost of sales.

- Stephen Byrd

Raymond James (Outperform rating unchanged, $90 PT up from $80)

As commodity stories go, First Solar is large-scale, cost-competitive, and highly bankable. First Solar is the only U.S.-based module supplier in the global top ten -- see the Solar Power chapter of our newly published Clean Tech Primer for details -- and it is also the only one without direct Chinese exposure.

The absence of concrete cost metrics makes it impossible to say with precision how First Solar's module costs compare with Chinese players, but our sense is that the company is in the industry's top quartile on gross margin.

- Pavel Molchanov