Here's a pop quiz question about alt-energy stock star First Solar ( FSLR - Get Report).

Knowing that revenue nearly tripled last year and that the company's market cap is more than $16 billion, how much would you guess 2007 revenue was?

a. $500 million.
b. $1 billion.
c. $2 billion.
d. $3 billion.

Alas, it was only $500 million -- don't let the market's valuation try to tell you otherwise. Investors have valued First Solar's stock at 35 times its most recent year of revenue.

(TheStreet.com's Roger Nusbaum takes a contrary look at solar stocks here.)

That price tag shouldn't be ignored by those who haven't invested money in First Solar. That such enthusiasm would buoy a company less than a decade old with only a half-billion dollars in revenue -- especially in a market where investor enthusiasm has been in short supply -- suggests that solar stocks, the breakout sector of 2008, may be as close as we get to a "safe" haven in 2008.

I put "safe" in quotes because you have to wonder how secure a stock trading at 35 times revenue really is. ( Talisman Energy ( TLM), an old-school energy company with a similar market cap, is trading at two times revenue. Applied Materials ( AMAT - Get Report), an older maker of solar and non-solar semiconductors, is at two-and-a-half times revenue.)

But that's the stock market we're stuck with these days.

Now, there's plenty of reason for investors to get excited about First Solar. The company did blow away earnings this week, posting a 77-cent-a-share profit that was more than 1 ½ times the 53 cents analysts were expecting.

Even so, the company's impressive $2.03-a-share profit for all of 2007 is less than one 100th of the share price.

Then there's the issue of First Solar's manic growth rates. Revenue in the most recent quarter was four times larger than in the year-ago quarter; net profit was nearly eight times larger. Money is coming in so fast that 40 cents of every dollar that First Solar made all of last year came in the final quarter.

Yet it's hard to tell whether First Solar is going to hang onto that kind of growth. On average, analysts surveyed by Thomson Financial are expecting revenue to grow 87% to $942.2 million this year and profit to grow only 22% to $2.48 a share. That's after the recent upward revisions by analysts following the strong fourth-quarter report. Granted, there may be more revisions coming, but it'll take a lot of tweaking ahead to justify those prices.

But the high-orbit valuation that First Solar investors are content to put on the stock suggests they believe the company will continue to blow out the Street's earnings estimates this year.

However, the risk inherent in such optimism is very real. Suntech Power ( STP) lost one-fifth of its value Wednesday after disappointing in its December quarter and guiding down estimates for the current quarter.

It's a reminder that the solar sector hasn't evolved far from its roots in semiconductors, where supply and pricing factors can lead to volatile fluctuations.

So it's back to the old quandary for solar stocks: Are they driven by pure speculation, or future growth, or a little of both? Many solar energy companies are insulated from economic slowdowns because of long-term government subsidies. And the initial concerns that an economic slowdown could rein in oil prices aren't panning out: Oil is closing in on $100 a barrel once again.

But this time the ante has been raised significantly because there are fewer sectors around that can deliver the kind of growth that the solar industry is believed to be offering.

Judging from last week's First Solar conference call, analysts are satisfied with the company's plans to expand capacity dramatically in coming years to push into new markets, and its ability to push up module efficiency rates while bringing down module production costs. That's being reflected in margins: Operating income was 39% of revenue last quarter, up from 17% a year earlier.

Such is the buzz around First Solar that it's emerging as something of a bellwether for solar stocks, even though the majority of its revenue to date has come from Germany alone. Yingli Green Energy ( YGE) and JA Solar ( JASO) were among the stocks that rallied on First Solar's numbers, although they've given up most of those gains since then.

As First Solar pushes beyond Germany into the U.S. and Europe, as well as nonsubsidized contracts, it will become a more accurate barometer for its sector. But such expansion brings new risks that may not be fully priced yet into its shares.

The market remains somewhat cautious on the solar sector for now, but a few more earnings reports showing resilience and growth could return the spotlight to solar power in the coming months.