With 17 of the 20 analysts covering First Solar (FSLR -11.5%) holding neutral or bearish stances going into the company's Q4 report, little sympathy is being shown in response to a big Q4 miss and soft Q1 guidance.
Goldman (Sell, PT lowered to $42 from $45) continues to see a "lack of upside in First Solar's utility-scale model." The firm points to checks showing a "challenging U.S. growth outlook for large-scale utility projects," mixed performance in emerging markets, and the lack of a near-term yieldco spinoff/IPO for First Solar's solar projects (SunEdison recently filed for one).
Goldman also thinks First Solar's ability to hit a 1:1 book-to-bill at the end of 2013 was accompanied by a mix shift towards lower-margin module orders.
Morgan Stanley is pleased with First Solar's cost-cutting moves, but also thinks investors are counting on "a large degree of profitable international growth," which it considers "highly uncertain." Cowen expects gross margin to be down 450 bps Q/Q, but also notes Q1 guidance "may not be indicative of full-year results."