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First Solar, Inc. Message Board

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  • gary012003 gary012003 Sep 22, 2007 7:58 AM Flag

    Reminds me of PEIX

    I can tell you: as long as there are some folks who doubt FSLR, it will move much higher. When messege board is full of bullish comments, it is time to be out of FSLR, because WAll STREET will fool most people, or most people cannot make money from stock market, only minority folks who know this money game can make money consistently.

    You, another newbies, have long way to learn stock market!!

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    • So you've learned the stock market have you? Could you please teach me what you know?
      All I'm saying is Solar is the rage right now and it is reminiscent of the peix, ande ethanol producers moves of last year. Both of them went up, up, up while ethanol was the rage. Suddenly the price of oil dropped, both fell from favor and haven't recovered. ande recovered somewhat due to retail ops and railcar business but peix is still down due to negative and low earnings while they are a single product company.
      The curve seems very similar if you examine it. Perform your due diligence and look at the earnings of fslr and how they have been achieved. They are hanging their hats on the fact that the German plant would be ready to contribute in time to impact the second half of the year in a phenomenally positive manner. I haven't memorized the numbers but I think the 1st half of the year achieved revenues of about 135 million dollars with 7 cents earnings per quarter. At the last quarter cc they upped the projected revenues from something like 385 to 400 million to 400 to 415 million. They predicated this number on the expectation of opening up the German plant and producing for the entire 2nd quarter. This didn't happen. If you've ever been involved in a ramp up then you know it really takes a few months to hit your stride, sometimes longer. That puts us into November for sure but it may be the new year before meaningful product can be delivered from the new plant.
      By the way, when the bottom dropped out on peix and ande it did so in the matter of days. There was no place to hide because it seemed as though things would go back up but then they just kept falling. This is the characteristic of a speculative stock. Goldman Sachs is an awesome investment bank to have on your side but even they can't manufacture earnings.
      In addition to this the enthusiastic analysts have completely discounted the fact that sg&a, r&d and cogs is going to balloon as the need goes into overdrive, also ignoring any charges they will take due to unexpected costs opening the Frankfurt plant which will include the increasingly unfavorable Euro exchange rate and cost overruns that will be notable for the Malaysian plant. You cannot operate a company and not have commensurate expenses.
      FSLR realized a one time accounting charge last quarter and will not be able to live up to that earnings number in the second quarter next year.
      These challenges are the same challenges all companies face after their startup. This isn't a new thing and it isn't an internet search engine company that has relatively little operational expenses. FSLR is a manufacturing company with a growing number of shares outstanding that will be hard pressed to meet expectations, let alone exceed them.
      I'm an analyst of sorts by profession and am very good at picking out inconsistencies created by unreasonable expectations on the part of management projections that are driven by the need to ameliorate circumstances surrounding the hubris that is necessary to attract investors in the beginning of a project.
      Management is feeding the money people with the tidbits they think the investors want to hear. They will rationalize the inconsistencies by coming up with alternative means of showing operating revenue which will really be financing revenues that are moved from cash flow to income statement line items. They do it all the time and good investors with good analytical skills know how to find the clues necessary to flesh out the differences.
      Now please tell me how to beat the market. I can't wait to apply your wisdom in the coming weeks and months to save myself from certain ruin.

 
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