Should You Buy the Dip in First Solar Stock?

Core Viewpoint - First Solar's shares dropped over 10% following a downgrade to "Hold" by Jefferies analyst Julien Dumoulin-Smith, citing concerns over limited visibility into future bookings and reduced policy support due to recent legislative changes [1]. Group 1: Financial Performance and Valuation - First Solar's stock is currently trading at a forward price-earnings (P/E) multiple of 11.54x and has a strong balance sheet with improving free cash flow [3]. - The company's gross margins have deteriorated to approximately 11% in 2025 from 20% the previous year, indicating challenges in maintaining pricing power in a competitive landscape [4]. - The book-to-bill ratio stands at about 0.5x, with recent cancellations from a major BP affiliate highlighting counterparty risks and suggesting weaker demand [5]. Group 2: Market Sentiment and Trends - Despite the recent decline, First Solar shares are still up around 100% compared to their 52-week low [2]. - Historical data shows that First Solar has lost an average of 1.20% in February, which may affect its attractiveness to investors at current levels [6]. - Other Wall Street firms remain bullish on First Solar, indicating a divergence in sentiment compared to Jefferies' cautious stance [8].