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We are seeing multiple indications of a potential movement for First Solar Inc. (FSLR) from our proprietary investment program and believe FSLR will move within the next two months.

Why FSLR?

  • Increase in Option Volume
  • Increase in Open Interest
  • Increase in Implied Volatility
  • Trailing P/E (ttm, intraday) 19.04
  • Forward P/E (fye Dec 31, 2011) 17.02
  • Price/Sales (ttm) 5.15
  • Price/Book (mrq) 3.90
  • Enterprise Value/Revenue (ttm) 4.87
  • Enterprise Value/EBITDA (ttm) 13.14

Company Description

First Solar, Inc. (First Solar), incorporated on February 22, 2006, is engaged in the manufacture and sale of solar modules with an advanced thin film semiconductor technology, and it designs, constructs and sells photovoltaic (PV) solar power systems. It operates the business in two segments: components segment and systems segment. Components segment designs, manufactures and sells solar modules to solar project developers and system integrators. Systems segment provides PV solar power system for commercial systems, which includes project development, engineering, procurement and construction (EPC), operating and maintenance (O&M) services and, when required, project finance. In April 2009, First Solar acquired the solar power project development business of OptiSolar Inc.

Components Segment

The Company's components segment involves the design, manufacture and sale of solar modules, which convert sunlight to electricity. Each solar module is approximately 2ft × 4ft (60cm × 120cm). Solar module is a single-junction polycrystalline thin film structure that uses cadmium telluride as the absorption layer and cadmium sulfide as the window layer. Cadmium telluride has absorption properties that are matched to the solar spectrum.

The company has integrated its manufacturing processes into continuous, integrated production line within three stages: the deposition stage, the cell definition stage, and the assembly and test stage. In the deposition stage, panels of treated glass are robotically loaded onto the production line where they are cleaned, heated and coated with a layer of cadmium sulfide followed by a layer of cadmium telluride. In the cell definition stage, First Solar use lasers to transform the single semiconductor-coated plate into a series of interconnected cells that deliver the desired current and voltage output. In the assembly and test stage, it applies busbars, laminate, a rear glass cover sheet and termination wires, seal the joint box and subject each solar module to a solar simulator and current leakage test.

Systems Business

The company provides a PV solar power system solution, which includes project development, EPC services, O&M services and, when required, project finance. The systems business is dependent upon the completion of project development activities, including site selection and acquisition. The project development activities are focused on markets in North America, Europe and Asia. In North America, the company entered into 1.25 gigawatt (GW) of power purchase agreements with utilities in the southwestern United States, and has a pipeline of approximately 150 megawatts (NYSE:MW) of projects in Canada. In Europe, it is engaged in project development activities of certain projects in France and Italy. In Asia, its project development activities include the initiatives in China.

Currently trading at approximately $138.41, we believe, based on our proprietary program, movement within the next two months is forthcoming. FSLR trades on average 2,000,000 shares per day, and has traded up from $105.00 back in June.

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Financials

In Millions of USD(except for per share items)

3 months ending 2009-09-30

3 months ending 2009-06-30

Revenue

587.85

567.96

Other Revenue, Total

-

-

Total Revenue

587.85

567.96

Cost of Revenue, Total

305.95

287.07

Gross Profit

281.91

280.89

Selling/General/Admin. Expenses, Total

78.60

66.86

Research & Development

22.84

22.89

Depreciation/Amortization

-

-

Interest Expense(Income) - Net Operating

-

-

Unusual Expense (Income)

-

-

Other Operating Expenses, Total

-

-

Total Operating Expense

407.38

376.82

Operating Income

180.47

191.14

Interest Income(Expense), Net Non-Operating

-

-

Gain (Loss) on Sale of Assets

-

-

Other, Net

-0.44

-0.73

Income Before Tax

180.44

195.36

Income After Tax

159.04

172.34

Minority Interest

-

-

Equity In Affiliates

-

-

Net Income Before Extra. Items

159.04

172.34

Accounting Change

-

-

Discontinued Operations

-

-

Extraordinary Item

-

-

Net Income

159.04

172.34

Good luck investing.

Disclosure: Author holds positions in FSLR

Source: Impending Move in First Solar