First Solar is set to shine – should you invest?
Solar-power specialist First Solar will benefit from Donald Trump’s policies, says Matthew Partridge


The US has been undergoing a quiet energy revolution. The amount of energy produced by solar, wind and geothermal sources has more than tripled over the last decade. Solar energy has been one of the big winners.
Total installed capacity has grown eightfold, while solar power’s share of new energy capacity has expanded almost continuously from a minuscule 4% in 2010 to 66% in 2024, a figure that rises to 84% when you include storage. While Trump’s return to the White House has cast doubt on the subsector’s progress, even he may not be able to stop its rise. That is good news for firms like First Solar (Nasdaq: FSLR).
For most of its history, First Solar has focused on making and installing solar panels; it is still the seventh-largest manufacturer of photovoltaic (solar) power cells in the world. However, in the past few years, it has shifted its emphasis from panels for retail customers to utilities and now makes much of its money from building and maintaining solar power plants.
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This shift has proved a shrewd move, as power companies have been eager to invest in solar energy in order to secure a range of tax credits and mandates from both the US government and individual states, notably the Inflation Reduction Act of 2022.
Silver linings for First Solar
Even though Donald Trump’s new bill curtails many of Joe Biden’s incentives for solar power, there are several silver linings for First Solar. Firstly, the tax credits for utilities will last longer than those for residential panels, while Trump’s changes won’t affect state-level mandates.
Most importantly, Trump’s tariff policies mean that the solar panels sold by Chinese rivals, who currently dominate the market, accounting for seven out of ten of the world’s largest producers, are now much more expensive. While the tariffs have also increased the price of many components that First Solar imports, the net impact of the tariffs is so positive for First Solar that even when you take the subsidy cuts into account, the group is in a better position than it was before Trump arrived in office, according to management.
First Solar has made excellent progress over the past few years, with sales rising from $3.06 billion in 2019 to $4.21 billion five years later – an increase of 40%. Sales are expected to grow even faster in future, increasing by around 50% in the next two years. Normalised earnings per share have jumped more than tenfold between 2019 and 2024, while operating margins have swelled, and the company now boasts a double-digit return on capital employed. Despite this, First Solar is still valued at only eight times 2026 earnings.
With First Solar recently upgrading its profit forecasts, the stock has been on a tear, beating the wider market over the last six months. It is also trading above its 50-day and 200-day moving averages. I therefore suggest that you go long at the current price of $184 at £11 per $1. In that case I recommend putting the stop-loss at $100, which gives you a total downside risk of £924.
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Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.
He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.
Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.
As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.
Follow Matthew on Twitter: @DrMatthewPartri
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