First Solar

First Solar was recommended in this SeekingAlpha article. I have a lot of doubts in this company. Some of my fellow commentators could be hedge fund managers or retail investors holding a lot of this stock. Their arguments of investing in this stock do not make a lot of sense. Even it has potential appreciation as stated in the article and the comments, it is too risky by many fundamental metrics. The company is losing a lot of money and the outlook of solar industry is cloudy.

This stock has been recommended by many well-known subscription services. Most followers lost money. My advice: Analyze the company with an open mind on any recommendation and understand the hidden agenda of the writer.

Here are my negatives on this company:

1.       They cannot compete with Chinese companies if the protectionism is lifted. Some companies in Europe produce better products. Hence, they depend on local sales and tax rebates.

2.       Solar is still expensive if oil is below $100 in most regions of the USA.

3.       Shale oil and gas could make solar here infeasible. The time for shale energy is 5 years from now (3-2013) if they can solve the environmental problem and set up the pipelines.

4.       How many previous losers (there is a lot) on this stock will return? More importantly, how many investors find its potential appreciation attractive?

5.       The company is losing money now.

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Disclaimer. I'm not responsible for your actions in your investment. Treat this as educational information and past performance does not guarantee future performance.