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Industry data cross 5,000 projects that are ongoing or in the pipeline suggests First Solar, Inc. (NASDAQ: FSLR) is "in trouble," according to Barclays.
Moses Sutton downgraded First Solar from Overweight to Underweight with a price target lowered from $66 to $49.
First Solar held a 20% market share in past solar projects, but its share of projects that are currently in development stands at just 4%, Sutton wrote in a note. The data was compiled by Bloomberg New Energy Finance (BNEF) database and accounts for acquisitions, multiple company names, and excluded projects above 10 MW.
The research firm's deep dive into thousands of projects and taking into account the age of the pipeline (when new developments were announced) and the stage of development, makes it "unlikely" First Solar will "maintain a position" among top downstream players.
First Solar's closure of its EPC business "hinted" it's struggling to win new projects, according to the analyst. However, there's still reason to believe First Solar will capture a total market share of at least 10% moving forward.
Despite a shift from bull to bear, the firm emphasizes it's not a bearish call on the overall U.S. solar industry. Also, First Solar deserves some credit for its resiliency in a challenging module pricing, bookings coming in ahead of expectations, and improving unit costs.
First Solar's stock traded lower by 6.5% to $54.97 per share at time of publication.
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