The shares rocketed higher Wednesday after fourth-quarter results swung to a profit on strong demand for solar cells
As experts worry about the threats of global warming and oil supply scarcity, alternative energy is still hot. First Solar (FSLR) announced a profit as demand grows for its solar cell products, and investors bid up the company's shares more than 27% Feb. 14.
First Solar's net income swung to a profit of more than $8 million during the three months ended Dec. 30, compared to a loss of $7.2 million during the same period a year ago, the company said in a press release late Feb. 13.
CEO Michael J. Ahearn has been trying to boost the company's production capacity, taking steps like expanding business in Ohio and building a manufacturing plant in Germany. Customers are buying. In one example, First Solar said Feb. 14 that it plans to supply solar modules for a 40-megawatt solar power plant -- one intended to prevent an estimated 25,000 metric tons of greenhouse gas emissions from being released into the environment. The plant will be constructed in Germany by juwi solar GmbH, starting in the second quarter of 2007.
But the Germans aren't the only ones. As interest in solar energy grows worldwide, First Solar's sales rose during the December quarter to $52.7 million, up 287.5% compared to the same period of 2005.
"Better-than-expected revenue resulted from a faster-than-anticipated capacity ramp, favorable pricing on sales outside of long-term contracts, and some foreign currency benefit," First Albany Capital analyst Sanjay Shrestha said in a research note. Shrestha raised estimates on the company’s revenue and operating earnings per share in 2008, bringing the firm's target price on the stock up by $8 to $44 per share. (First Albany Capital does business with First Solar.)
Investors bid up the stock 27.9% to $43.83 per share in late trading on the Nasdaq Feb. 14.