First Solar: Its shares are worth more than 2 barrels of oil

by Jeff Dorsch, April 24th, 2008, 7:00 am

When we last posted about First Solar, the thin-film solar module manufacturer’s stock had gone north of $200 a share. Now, after a few months of gyrations up and down, the stock has breached the $300 level and may be testing new highs on a daily basis.

This story is remarkable because the company went public in November 2006 at $20 a share. This 15x boost in price makes Google look like a value stock.

Earlier this month, Lazard Capital Markets increased its price target on FSLR from $250 a share to $300 a share, and the stock easily cruised to that target within days. The backlash came this week, as Collins Stewart downgraded the stock from “buy” to “hold.” It was the first time an investment firm had downgraded its rating on FSLR in nine months. Things might get crazy again next week, after First Solar reports its Q1 results April 30.

Not all solar power stocks are enjoying such good times, as investors have grown more skeptical and pickier about the alternative energy sector. LDK Solar got a clean bill of accounting health over its silicon inventory issues, and the SEC’s staff gave the company a pass. LDK’s stock, however, has been stuck below $40 a share for months. SunPower got spanked by investors last week by giving an outlook that was, well, not as sunny as expected.

Still, EMCORE recently sparked interest in its stock when it announced that it was thinking of splitting into two companies, Fiber Optics and Solar Photovoltaics. Fiber optics? That’s so 2000. Photovoltaic solar power: Now, that’s the ticket these days.