In the last few months, solar stocks have taken a beating.
An economic slowdown in China, as well as the election of Donald Trump as U.S. president, is putting pressure on companies that manufacture and market solar panels. Trump will continue to have a negative effect on this industry, as well as alternative energy, as he holds controversial views on climate change.
Among solar stocks, First Solar (FSLR) is facing a particularly rocky patch and has just announced a massive downsizing. The company plans to fire one out of every four employees -- about 6,000 jobs, in all -- in a desperate bid to overhaul its operations. That has sent its stock plummeting. First Solar shares fell more than 6% in Friday trading.
Still, the company could present an opportunity for investors with a long-term perspective.
First Solar has already lost more than half its value in 2016. Required rates of return for its projects have shot up recently, hurting First Solar's bottom line.
First Solar is bleeding profusely from the knockout beating that the solar industry has recently received. To return to shape, the company has suggested a phase-out of its current production of the Series 4 module and the abandonment of its Series 5 line. It also hopes to accelerate production of Series 6.