First Solar (FSLR) closed the most recent trading day at $68.23, moving -1.56% from the previous trading session. This change lagged the S&P 500’s 0.38% loss on the day. Meanwhile, the Dow lost 0.5%, and the Nasdaq, a tech-heavy index, lost 0.05%.

– Zacks

Heading into today, shares of the largest U.S. solar company had lost 16.51% over the past month, lagging the Oils-Energy sector’s gain of 8.31% and the S&P 500’s loss of 6.25% in that time.

Investors will be hoping for strength from First Solar as it approaches its next earnings release. On that day, First Solar is projected to report earnings of $1.07 per share, which would represent a year-over-year decline of 0.93%. Meanwhile, our latest consensus estimate is calling for revenue of $918.43 million, up 50.75% from the prior-year quarter.

Any recent changes to analyst estimates for First Solar should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 6.23% lower. First Solar is currently a Zacks Rank #5 (Strong Sell).

Valuation is also important, so investors should note that First Solar has a Forward P/E ratio of 35.4 right now. For comparison, its industry has an average Forward P/E of 31.88, which means First Solar is trading at a premium to the group.

It is also worth noting that FSLR currently has a PEG ratio of 4.81. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. Solar stocks are, on average, holding a PEG ratio of 1.74 based on yesterday’s closing prices.

The Solar industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 216, which puts it in the bottom 16% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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