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First Solar (FSLR) to Post Q4 Earnings: What's in the Cards?

Zacks Equity Research

First Solar, Inc. FSLR is scheduled to release fourth-quarter and 2019 results on Feb 20, after market close. In the last reported quarter, the company delivered a negative earnings surprise of 72.64%.

Moreover, the bottom line missed the Zacks Consensus Estimate in the trailing four quarters, the average negative surprise being 372.1%.

Let’s discuss the factors that are likely to get reflected in the upcoming quarterly results.

Factors at Play

During the fourth quarter, First Solar is expected to have completed the sale of its 150-megawatt (MW) Sun Stream, 100-MW Sunshine Valley and 20-MW Windhub projects. This, in turn, might have made a meaningful contribution to its revenues and earnings in the soon-to-be-reported quarter. Solid solar module sales are also projected to get reflected in the company’s top line.

In line with such developments, the Zacks Consensus Estimate for First Solar’s fourth-quarter revenues is pegged at $1,760 million, indicating a 154.6% surge from the year-ago quarter’s reported figure.

At the beginning of 2019, First Solar's management anticipated Series 6 per watt costs to decline approximately 30% by the end of the fourth quarter. In this context, at the end of the third quarter, the company remained slightly ahead of its planned roadmap and expected to maintain the momentum in the fourth quarter. As a result, we expect the decreasing cost to have favorably impacted the company's bottom line in the to-be-reported quarter.

Moreover, driven by lower ramp-up expenses and cost per watt for the Series 6 modules, First Solar has been witnessing improved gross margins lately. This trend is likely to have continued in the fourth quarter.

In line with the aforementioned projections, the consensus mark for First Solar’s fourth-quarter earnings is pegged at $2.87 per share, indicating a massive 485.7% surge from the year-ago quarter’s reported figure of 49 cents.

During the fourth quarter, First Solar successfully closed the sale of its 72-megawatt Seabrook project to Dominion Energy D. We may expect the upcoming results to duly reflect sale proceeds from this transaction.


First Solar, Inc. Price and EPS Surprise

First Solar, Inc. Price and EPS Surprise

First Solar, Inc. price-eps-surprise | First Solar, Inc. Quote

What the Zacks Model Unveils

Our proven model predicts an earnings beat for First Solar this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

First Solar has an Earnings ESP of +0.25% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Upcoming Solar Releases

Vivint Solar VSLR carries a Zacks Rank #3 and is expected to post fourth-quarter 2019 results soon.

SolarEdge Technologies SEDG carries a Zacks Rank #3 and is set to report fourth-quarter 2019 results on Feb 19.

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