First Solar (FSLR) Inks Agreement for Series 7 Solar Modules


First Solar, Inc.


FSLR

recently inked a supply agreement with National Grid Renewables for 1.6 gigawatts (GW) of Series 7 thin-film solar modules. Before this, in June 2022, the company inked a deal with National Grid Renewables for 2 GW of modules.

Thus, the latest agreement takes the alliance between the two companies for more than 4 GW of solar modules. Moreover, National Grid and First Solar have been partners for a decade over multiple solar projects.

Benefits of the Agreement

National Grid boasts a portfolio of solar, wind and energy storage projects throughout the United States. With the rising demand for solar-based energy, National Grid may expand its footprint with solar energy projects.

In such a scenario, First Solar may witness an inflow of orders for solar modules, mainly due to the long-standing partnership between the two companies and the remarkable features of these modules. Additionally, the wide footprint of National Grid across the United States opens avenues for FSLR to ink long-term supply agreements on a large scale, ensuring a steady inflow of revenues.

First Solar’s Growth Prospects

First Solar enjoys strong demand for its solar module due to its advanced thin-film PV modules that have set industry benchmarks for quality, durability, reliability, design and environmental performance.

To meet the growing demand, the company is investing heftily to scale up its operational capabilities. First Solar plans to invest $1.3 billion to expand its Ohio manufacturing footprint, as well as for a new manufacturing facility in Alabama.

Such strategic investment plans are likely to take First Solar’s total investment in American manufacturing to more than $4 billion, thus expanding its U.S. manufacturing capacity to more than 10 gigawatts-direct current by 2025.

Additionally, the company intends to upgrade its research and development expertise by investing $270 million in a dedicated research and development innovation center in Perrysburg, Ohio.

Such capacity expansion and a smart investment strategy are likely to boost First Solar’s ability to manufacture products at an increased pace and capitalize on the growing demand. These will also enhance its footprint in the global solar market.

U.S. Solar Market Boom & Peer Moves

Electricity generation from renewable sources is increasing manifold in the United States. Per the latest report from the Energy Information Administration, 24% of U.S. utility-scale electricity generation came from renewable sources in the first six months of 2022 compared to 21% in the same period last year. Further, the report suggests that another 13 GW of solar capacity will come online by the end of 2022.

Such a strong demand scenario is likely to benefit solar companies like First Solar, which are continuously striving to expand in the U.S. solar market. Solar players that may benefit from the increased solar demand are as follows:


Enphase Energy


ENPH

enjoys a valuable position in the solar market by manufacturing fully integrated solar-plus-storage solutions. It holds a strong position as a leading U.S. manufacturer of microinverters.

Enphase boasts a long-term earnings growth rate of 47.4%. Shares of ENPH have surged 66.1% in the past year.


SunPower


SPWR

is one of the most forward-integrated solar companies, having more than a decade of experience in designing, manufacturing and supplying large-scale solar systems. The company continues to witness growth in residential and commercial markets.

The Zacks Consensus Estimate for SunPower’s 2022 earnings suggests a growth rate of a solid 371.4% from the prior-year reported figure. SPWR has returned 1.7% to its investors in the past year.


ReneSola


SOL

continues to expand in the United States. As of Sep 30, 2022, the company had IPP projects of nearly 24 MW in the United States.

The Zacks Consensus Estimate for ReneSola’s 2022 sales indicates an improvement of 9.5% over the prior-year reported figure. The Zacks Consensus Estimate for SOL’s 2023 earnings has been revised upward by 13.8% in the past 60 days.

Price Movement

In the past year, shares of First Solar have surged 74% compared with the

industry

’s growth of 21.7%.

Zacks Investment Research


Image Source: Zacks Investment Research

Zacks Rank

First Solar currently carries a Zacks Rank #3 (Hold). You can see


the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here



.


Zacks Top 10 Stocks for 2023

In addition to the investment ideas discussed above, would you like to know about our 10 top picks for the entirety of 2023? From inception in 2012 through November, the

Zacks Top 10 Stocks

portfolio has tripled the market, gaining an impressive +884.5% versus the S&P 500’s +287.4%.

Now our Director of Research is combing through 4,000 companies covered by the Zacks Rank to handpick the best 10 tickers to buy and hold. Don’t miss your chance to get in on these stocks when they’re released on January 3.


Be First to New Top 10 Stocks >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.

Click to get this free report


To read this article on Zacks.com click here.


Zacks Investment Research