First Solar Shares Trade at 24% Discount to Fair Value
First Solar closed at $191.97 on Sept 23, sitting well below its $252.22 intrinsic value estimate despite recent insider selling.
Key points
- First Solar closed at $191.97, which is 23.9% below the $252.22 fair value estimate from GuruFocus.
- The stock trades at an 11.8x trailing P/E ratio, significantly lower than its 19.8x five-year median.
- Insiders sold $41.4 million in shares over the past 12 months without any reported buying activity.
First Solar Inc shares dropped 4.4% on September 23, 2026. The stock closed at $191.97. This places it near its 52-week low of $182.99. The company trades below its estimated fair value.
GuruFocus calculates a fair value of $252.22 for the solar manufacturer. This represents a 23.9% margin of safety. The stock has fallen 26.5% year-to-date. This decline reflects broader market sentiment shifts.
Valuation Metrics Signal Deep Discount
The trailing price-to-earnings ratio stands at 11.8x. This is 40% lower than the five-year median of 19.8x. The forward P/E ratio is 8.2x. These figures suggest the market prices in lower earnings expectations.
This valuation gap aligns with the intrinsic value estimate. The company trades at a significant discount to historical norms. Such pricing often appears when investors doubt future growth. However, the current multiples remain historically low.
Strong Financials Offset Weak Momentum
The company holds a GF Score of 90 out of 100. This aggregate score measures financial strength and profitability. First Solar scores 9 out of 10 in financial strength. It also earns a 9 in growth.
Profitability ranks at 7 out of 10. Valuation scores 8 out of 10. Momentum lags at 7 out of 10. The weak momentum score reflects recent price weakness. It indicates a lack of strong upward price movement.
Insider Selling Signals Cautious Sentiment
Insiders sold $41.4 million in shares over the past year. There was no reported buying activity. Nine institutional investors currently hold the stock. Three added to their positions recently.
Eight other holders trimmed their stakes. This mixed activity shows divided institutional sentiment. Insider selling can indicate a desire to lock in gains. It may also suggest cautious views on near-term prospects.
