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Luz del Norte

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Luz del Norte last won the day on February 23

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  1. When you find yourself thinking you know more than Finlay Colville you might want to take step back and reevaluate things. He is perhaps the most knowledgeable person on the solar industry. In regards to First Solar, the company has said it plans on making ~$2.50 this year and should get the S6 manufacturing wrinkles ironed out by the end of the year. With costs around 22 cents and a backlog averaging 37 cents for the next two years, 2020-21 will be extremely profitable. That gives the company 2 years to get efficiency up to 20%. When that happens, it will have around 9GW of modules at a mid teen cost. With solar reaching cost parity and battery technology improving, it is doubtful prices will far much further.
  2. It is impossible to predict. FSLR planned on selling Sun Streams, Sunshine Valley, Seabrook, Ishikawa, and various plants in India this year. Earnings will vary considerably depending on whether these sales close in Q3 or Q4. My hunch is these won't close until Q4 so this quarter will be a miss, at least as far as revenue goes.
  3. This silly debate inadvertently spells outs First Solar's best selling point. FSLR make one product while Canadian Solar and others make several dozens of panels, all of varying sizes and technologies. Good luck to any developer using these non-traditional sized panels finding replacements in a few years. This article does a good job spelling out the mess the industry is in with this absurd game of claiming high wattage panels. https://www.pv-tech.org/editors-blog/solar-panel-suppliers-fixated-on-power-gains-but-is-the-industry-really-ben
  4. How so? The company will make over $3 in the second half of this year. Then it should earn over $1 for the next few quarters. So a year from now it will have a trailing EPS of over $5 and an even better cash flow as the new factories depreciate. As efficiency improves from 17% to over 20%, cost and output will improve considerably.
  5. You are comparing GAAP to Non-GAAP earnings. The big question is whether the non-GAAP adjustments are valid or a farce like how SunPower does things.
  6. The Green New Deal is absurd because it never mentions Solar, Wind, Coal, or Natural Gas but it does mention "indigenous peoples" 6 times and "worker" 9 times. It also mentions "affordable, safe, and adequate housing", "high-quality health care" and dozens of other things that are completely unrelated to renewable energy. It is basically a new communist manifesto in the guise of green energy document. Getting to carbon neutral is possible but bogging it down with all sorts of non-related goals is counterproductive.
  7. It's been said that it a solar farm of around 100 miles square (10,000 sq. miles) in the southwest US could produce enough electricity to power the non-renewable portion of the US grid. This would be about a 1,000 GW plant. With solar costing under $1/W, this would cost around $1T and could likely pay for itself. It would seem the "green" part of the Green New Deal would be the cheapest part of that absurd document by AOC. There are a several problems with this hypothetical mega farm. First off, storage and distribution would need to be figured out. Next, total worldwide installations last year were under 100GW so capacity would need to scale up dramatically. Also, the grid is only a part of all the fossil fuels used and the US uses only 1/5 of the world's electricity. The point is, though, that thanks to the efforts of the US, Germany, China, and others, the cost of solar has fallen to the point where the ability to significantly lower carbon emissions is now a real possibility. A company that has survived the brutal race to sub $1/W pricing while remaining profitable and cash flow positive likely has a very bright future.
  8. Why are you calling First Solar a POS? It seems you have transferred your anger at a certain poster onto the company. The outright hostility some folks here have for FSLR is rather comical. When comparing First Solar and Canadian Solar you really need to go by enterprise value as the debt (and lack of debt) really changes the picture. First Solar has an EV of $3.2B. Canadian Solar is at $2.85B. Redoing forward earnings based on EV leaves FSLR at 13 and CSIQ over 14. Both companies seem to be similarly priced right now. Then consider that First Solar could have gone all SunPower and considered the ramp and startup costs as a Non-GAAP expense. Doing so would have put EPS at around $4. In addition, EPS won't tell the whole picture because in a year or two cash flow will go up dramatically as the new S6 factories start to depreciate. Lastly, FSLR has these earnings based on 17% efficiency panels. Considering that 3 years ago the company created a cell with 22.1% efficiency, it doesn't seem like much of a stretch to think the company can get module efficiency over 20% in the next three years. Doing so would have a dramatic impact on cost per watt and earnings. Solar has gotten to the point where it has gotten cheaper than the operating cost of coal unsubsidized. That means it should really take off soon. Plus, the mad rush to drive prices down should lessen.
  9. I am not Klothilde but I do have a few predictions for the upcoming earnings. First off, the company should declare a fairly large tax refund. In 2017 First Solar took a $405M hit to repatriate its overseas earnings due to the new tax bill. Considering the one-time rate was 15.5%, this seemed like a massive overpayment. Management has a history of overpaying taxes and then claiming a big refund. Unless I am mistaken this should provide a huge ($1.5-$2) EPS beat. The company has alluded to a potential refund in every earnings call and 10-Q this year. Here is what they said last time. "To relate, the U.S. tax reform enacted last December, we have not recorded any adjustment through Q3 related to our original estimates. We expect to finalize our accounting related to tax reform in Q4 based upon finalization of currently proposed tax regulations and the filing of our federal and state income tax returns." Also, during the guidance call the company hinted at possibly expanding in either Vietnam or Ohio. It wouldn't be to surprising for them to announce construction beginning on a third plant in Vietnam. Also, management mentioned getting started on 5GW of projects to qualify for the ITC Safe Harbor requirements. This should mean that the projects pipeline should grow dramatically in the next few quarters. Lastly, here's an article about a 135GW project getting developed in Cambodia. It would appear the company is still competitive internationally.
  10. Mark, if you look at First Solar's chart, until this latest dive under $50 the company has actually outperformed the S&P over its lifetime. I was shocked to see that. Looking at the spikes its been an insanely bumpy rollercoaster ride. In hindsight it seems the way to have made money was to identify the troughs, load up, and then hold for a while. It really seems like FSLR is currently at a low point. It is hard to imagine a company that is sold out for two years, has a forward PE of around 16, and a large cash pile could fall much farther.
  11. If you assume that the systems business and ASPs are roughly the same between the two years, then your 2020 estimate seems plausible. The only difference would be the shift of the 2GW of S4 to S6. The estimated 2019 margins seem to be around 15% for S4 and 30% for S6 based on around 35 cent ASP. That would mean an increase in profits of around $105M. Considering the 2020 S6 costs should be lower, this seems like a low estimate. In addition, ramp and startup costs are expected to be $65M lower. Combined, these two things would push EPS over $4. It sounds like the company plans on building at least one more factory in the near future. That would increase the 2020 startup costs. On the other hand, I would bet there is a lot of conservative guidance built into the numbers. Once the factories start producing at full capacity I bet the numbers will go up.
  12. It would be interesting to see if management mentions this recent story about LeTID degradation issues with PERC. It seems like that could be a really nice selling point for First Solar. Management said during last earnings call that it would discuss the IRS guidance establishing the ITC Safe Harbor requirements. 2021-23 could see a lot of systems business in the US and hopefully the company will discuss this in more detail. Also, this article from earlier today is interesting. PI Berlin is now an approved testing institute for modules. The article only mentions series 4, however, but does state that PI Berlin has audited the series 6 factories. Not sure what this means.
  13. I am not really sure why you are going down this route. FSLR stated that cancelations were simply not an issue. Even if they somehow became an issue, there are penalties in place that would actually benefit First Solar. And as the company is sold out for the next 2.5 years and booked an additional 1.1GW in the past three months, FSLR doesn't seem to have any problem whatsoever finding buyers for its modules. While there might be increased competition in the US, First Solar is already booked out for 2019 and 2020. By 2021, there will be a boom in utility projects as developers rush to qualify for the ITC as the IRS safe harbored projects. If anything, First Solar might need to build that 3rd factory in Vietnam or 2nd in Ohio to meet the demand.
  14. The backlog 8.4GW for $3.1B. That comes out to 36.9 cents though I am guessing the increase over last quarter is a rounding issue. Incrementally the change was 0.1GW for $0.1B.
  15. This is the thing I really wonder about. Companies got through the 2016 downturn by doubling capacity. This time, however, not only will the market shrink rather than experience huge growth, but bigger fish like Longi are crowding the market and will shrink the available pool even more. It wouldn't be too surprising if in 5 years all the currently heavily indebted solar companies are distant memories, replaced by Longi, LG and other large corporations.
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