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Guest Klothilde

First Solar (FSLR)

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13 hours ago, Mark said:

I didn't read his latest gem, but I mean they're sold out into 2020.  By the time they actually have more capacity online and ready to take orders, those tariffs will be largely phased out anyway.  I never truly bought into the idea that tariffs were going to substantially impact FSLR in the first place, beyond locking in some longterm term bookings, which are already locked in now.  I feel like any benefit they got from tariffs has been baked in for a while.

I would be a bit careful about too much reliance on bookings in the face of risk of major market changes. Wafer makes made the same claim in 2011, that all their capacity were booked for a long-time at not just fixed volumes but also at fixed prices. However when those fixed prices became unviable in the market the contracts had to be re-negotiated. In reality the fixed prices no longer exists in the solar supply-chain as it has become clear that they cause too much disruption. The fixed volume remained though. Normally new volume was contracted at a much lower price than market to get the average price of the total contracted volume market aligned while committing to more volume. This allowed major players to retain market-share from new entrants. At the end of the supply-chain this solution is more difficult and could instead lead to conflict with customers if re-negotiation is not offered.

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To Mark:

I agree with you the excuse is not valid, because as you point out, they've already booked their orders.  But inasmuch as one can ever know what drives a stock price these days (with all the algo-driven trading), I think this is a reasonable explanation (for the irrationality of the market).

Looks like a good entry point for another swing trade.

Edited by solarpete
Forgot to indicate to whom the response is.

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I don't think there is a reason.  The market and all of us naturally want to find reasons behind every move.  It's human nature, afterall.  It's why people think there's a God up there in the universe.  I think this is nothing more than profit taking after a big run over the last year+ and at a spot in their growth when new money may be attracted to the stock, but old money wants to lock in some surf and turf dining.  The question becomes when and how much do the profit takers come back in?  

In thinking about it the last few days, I don't think there is any reason beyond profit taking. 

 

Edit: I hope I'm right and this isn't the whole market taking a dump due to all the reasons it could.  (aka, anything Trump does to us and the economy)

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Mark, did you sell some FSLR at $80?  I thought that was what you said you would do.

I hope you did.  Now, you can buy back in with $12 (15%) discount.

FSLR is a fine company, but I thought at $80, it was too high.  I think it had a good run and this is just some profit taking after a good run.  I know I would.

Good luck.  I think it will spring back to $80 again soon (after this bout of profit taking).

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I didn't sell nearly enough, that's for sure.  I still have a nice chunk of shares at 69.50, so I can't claim to have nailed that trade. I should have unloaded it all.  Never thought it would fall this far, but that's always when it happens, eh?

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https://www.bloomberg.com/news/articles/2018-05-11/gop-senators-want-to-exempt-giant-solar-farm-panels-from-tariffs

I suppose this news tanks FSLR on Monday.  Friday had some support from Morgan stanley.   So maybe the bad & good news cancelled each other out.

 

This is getting silly though...  tariffs on panels for residential but not on panels for Utility.  Is there actually any difference between these types of panels?  You'd pay a tariff based on how you are planning to use the panel??

Edited by sunnypease

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On ‎5‎/‎12‎/‎2018 at 6:45 PM, sunnypease said:

https://www.bloomberg.com/news/articles/2018-05-11/gop-senators-want-to-exempt-giant-solar-farm-panels-from-tariffs

I suppose this news tanks FSLR on Monday.  Friday had some support from Morgan stanley.   So maybe the bad & good news cancelled each other out.

 

This is getting silly though...  tariffs on panels for residential but not on panels for Utility.  Is there actually any difference between these types of panels?  You'd pay a tariff based on how you are planning to use the panel??

There's a difference in size and efficiency. Small efficient panels are suitable for the space limited residential segment and larger lower efficiency (cheaper) panels are suitable for the utility segment. Sunpower makes the former. First Solar makes the latter.

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