Freedom Broker analysts reiterated their “Buy” rating on shares of First Solar, Inc. (FSLR) and raised the target price to $280. At the current price of $234,9, the upside potential is about 19%. Despite a slight decline in revenue, the company beat market expectations on earnings, reaffirmed its 2026 guidance, and continues to strengthen its competitive position in the U.S. solar energy market.
About First Solar
First Solar, Inc. (FSLR) is the largest U.S. manufacturer of thin-film solar modules. The company is actively expanding its manufacturing capacity in the U.S., has a large order backlog, and could become one of the main beneficiaries of tighter trade restrictions on imports of solar equipment.
The market is underestimating the company’s potential
Experts believe the quarterly report confirms the resilience of First Solar’s business. Despite the decline in revenue, the company significantly improved profitability, maintained its full-year guidance, and continues to invest in expanding production capacity.
According to analysts, the company’s shares are trading at a noticeable discount to historical valuation levels: the 2026 forward EV/EBITDA multiple is around 8,9x versus a 10-year median of about 11x. As uncertainty around U.S. trade policy declines, the company’s valuation could move back closer to historical levels.
Earnings substantially beat expectations
In the second quarter of 2026, First Solar generated revenue of $1,06 billion, down 3,7% year over year. The decline was mainly due to the termination of certain customer contracts, though the negative impact was partially offset by increased shipments of solar modules.
The main surprise of the quarter was the company’s profitability. Operating profit rose 24,6% year over year to $450,4 million, and operating margin reached 42,6% versus 33,0% a year earlier. Net income totaled $422,6 million and exceeded the consensus forecast by about 40%. Earnings per share came in at $3,92.
An additional positive factor was the increase in adjusted EBITDA to $644 million, while gross and net cash at the end of the quarter totaled $1,7 billion.
Production is growing, guidance reaffirmed
In the second quarter, the company produced solar panels with total capacity of 4,3 GW (+1,8% year over year), and shipment volume increased 5,3% to 3,7 GW. First Solar reaffirmed all key 2026 targets: revenue of $4,9–5,2 billion; adjusted EBITDA of $2,6–2,8 billion; module shipments of 17,0–18,2 GW.
At the same time, construction continues on a new facility in South Carolina, which, once at full capacity, will be able to produce up to 3,5 GW of solar modules annually. The company’s order backlog remains one of the largest in the industry—45,1 GW of deliveries through 2030—providing high visibility into future revenue.
Tariff changes remain an additional driver
Freedom Broker believes that changes in U.S. trade policy could be one of the key catalysts for share-price growth. The Department of Commerce continues its investigation into imports of polysilicon and its derivatives. If the U.S. administration introduces additional tariffs, First Solar, with manufacturing capacity inside the country, could gain additional competitive advantages over foreign producers.
According to the analyst, it is the combination of government support for U.S. manufacturing, capacity expansion, and a large order backlog that makes the company’s investment case attractive over the long term.
Last year’s results
In 2025, First Solar delivered solid financial results despite ongoing volatility in the solar energy market. In the fourth quarter, the company increased revenue to $1,41 billion versus $1,16 billion a year earlier, while net income rose to $393 million ($3,65 per share) from $349 million ($3,25 per share). Net cash increased to $1,2 billion thanks to proceeds from tax credits and strong operating cash flow. In addition, the company secured new orders for 4,4 GW of solar modules and guided for 2025 revenue in the range of $5,3–5,8 billion, reaffirming strong demand for its products.
In the second quarter, First Solar Inc. reported net income of $342 million, or $3,18 per share, compared with $349 million, or $3,25 per share, a year earlier. Revenue increased from $1,01 billion to $1,10 billion. The financial results exceeded market expectations, which had forecast earnings of $2,66 per share on revenue of $1,04 billion.
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