On Tuesday, Jefferies made a notable adjustment to its outlook on First Solar (NASDAQ:FSLR), a leading solar technology company with a market capitalization of $20.14 billion. The firm's analyst has revised the price target for First Solar's shares downward to $248 from the previous target of $257. Despite this reduction, the analyst continues to recommend a Buy rating on the stock, aligning with InvestingPro analysis that suggests the stock is currently undervalued.
The revision comes against a backdrop of general underperformance in the renewable energy sector. However, the analyst sees potential uplift for First Solar from the anticipated procurement by data centers, which is expected to contribute to filling the company’s long-standing backlog of orders.
The analyst also noted that potential changes in domestic consumption (domcon) policies, which may be integrated under the Investment Tax Credit ( ITC (NS:ITC)), could be advantageous for First Solar. The Inflation Reduction Act (IRA), with its focus on domestic content, may increase the urgency for companies to procure First Solar's products in order to benefit from current safe harbor provisions.
Furthermore, the analyst mentioned that there is always the possibility of gaining from trade and tariff-related developments. According to the analyst's view, First Solar is the best positioned among its peers to navigate the challenges of the renewable energy sector and maintain a competitive edge through 2025.
In other recent news, First Solar has seen positive developments with Truist Securities maintaining a Buy rating and a steady price target of $300. This followed First Solar's announcement of a Tax Credits Sale agreement with Visa Inc (NYSE:V)., where tax credits worth $645 million will be sold for $616 million. The deal could potentially increase total proceeds up to $831 million if First Solar exercises the option to sell additional credits.
Truist Securities and InvestingPro data indicate that First Solar maintains a strong financial position and anticipate that First Solar will likely monetize its 2025 tax credits through similar agreements.
RBC Capital Markets has placed an "Outperform" rating on PG&E Corp and Williams Companies (NYSE:WMB), Inc and increased the price target for Williams Companies to $62. Energy Transfer (NYSE:ET) LP, the general partner of Sunoco LP, has also gained attention due to its financial performance and future prospects. RBC Capital and Citi have upgraded their price targets for Energy Transfer, citing increased estimates and potential for long-term growth.
Roth/MKM and RBC Capital have maintained their Buy and Outperform ratings on First Solar, respectively, with price targets of $280 and $315. Piper Sandler also raised the price target on First Solar to $250, maintaining an Overweight rating.
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