First Solar

So as many of you probably know Goldman Sachs just upgraded "First Solar" a solar energy company saying shares could rise 50% in the coming year. All while downgrading the whole solar sector as a whole.

Thoughts?

 

Well, not much to say here. Alternative energy is a must. It's interesting that Goldman Sachs has such in interest in $FSLR, do they have some sort of relationships? An article mentioned that First Solar has enough cash to invest but keep debt low.

I just hope we have some sort of affordable alternative energy source soon. Panels may be cheaper in the long run but not a lot of people can fork out the initial costs of installing them. I know there are some companies that rent them to you, but I bet those will go downhill as panels begin to become more mainstream and affordable. Those companies seem to be nothing but trouble the way that they advertise.

 

I just wanna know whats so special about this company that they can be projected to succeed in a falling sector. Maybe the makings of a monopoly of sorts? All i can say is i'm going to be keeping an eye on these guys see what pans out. I need to do more research.

 

It's hard for me to read much about it but one article wrote that their EPS and gross earnings were down from their predictions. Maybe we should take what Goldman Sachs says with a grain of salt. I'd be interested to look at their financials over time.

 

FLSR is so over valued its not even funny.. SCTY is a better company overall and its still in the 50s.. these energy stocks are so volitile you could short-term trade with them (monthly) (thats what i've been doing and watching) its crazy; once scty hits mid 40s again ima buy it and sell in high 50s, flsr once it hits around 50 ima buy it... just give it time its so overvalued

 

What do you think about how FSLR is helping other companies (such as SCTY) develop equipment? Like I said it's hard to follow a field I don't have much major interest in, but I was reading something about how their operating with a lot of cash because of some tax cuts for solar research?

 

thanks man this is the info i was looking for

 

If you want to see information like that in the future for publicly traded companies, go to their Yahoo finance page and look at their Beta. Beta is a good way of determining volatility because it basically means that for every Xpercent the market goes up or down, the stock itself will go up or down their Beta %, Y.

So $FSLR is 2.67 or so, that is an extremely volatile stock. Average would be 1, and lower risk investments would be reasonably under 1.00. For example, $CPB (Campbell Soup)'s beta is around .4 or so, last I checked. This means if you put your money in it you will likely not see any large gains, but at the same time you will not experience any huge losses. So on the contrary, if you put a lot of money into $FSLR and the market is doing well, then you will do very well. But if the market is doing poorly, you will experience big losses.

 

Nice i didn't know this thanks!

 

@sighz Yahoo's beta is the most unreliable beta to go by... In my finance class we have paired yahoo's beta with the actual calculation and a firms beta of stocks and yahoo's beta is skewed and not to be taken as the holy grail... it is also important to know that a beta of 1 is not "average"... a beta of of 1 means it correlates with the market completely.. meaning if the market were to go down then the stock will also go down exactly as the market.. the lower the beta the better.. you are better off calculating your own beta, it is very easy to calculate & if you'd like i can show you how...


@risk of std, i don't know much about flsr helping other companies, but that tax-break that was for solar companies applied to every solar company, SUNE,SCTY,FLSR --> All their stocks went up that day.. The main issue right now with their valuation is that oil is so cheap at this point it isn't affecting them too heavily.. but when oil is cheap that means there is less desire for "solar power" (and alternitive energies...in terms of a NECESSITY...it is always great for alternative energy..), but yeah I personally think FLSR is not as reliable as SCTY.. SCTY has Elon Musk on the board of directors... IMO FLSR & SCTY are currently the best investments for solar stocks... do not invest SUNE... They have way too much debt. But yeah... we will see, im waiting to see what their first quarter earnings this year are going to say for me to decide its new price for the year.. or ball range i should say..

SCTY reports Febuary 17 & FLSR is on Feb 23rd.... Until then i would not personally buy either.. if SCTY drops between 43-47 i would personally buy it and hold it until it hits high 50s.. but that's just my opinion i could be wrong, there is no prediction in the future (espesially with a new year)... stock performance are heavily coorelated with their earning releases & how well they do... but as of now until Q1 hits.. they shouldn't be more than 60$.. anything above that is currently absurd, but if you think they will do well buy them go for it!

I personally go for stocks that are for the long run with a good 1, 5, 10 year graph and good overall company...Like Nike, Starbucks,Apple(even though there is skeptisim) but my favorite stock currently is starbucks.

Overall if your looking for long-term I don't think FLSR should be in your portfolio...and honestly neither should SCTY... but SCTY is like tesla.. so it's all up to you, there is no "right" answer to investing

 

:sick:

I mean we learned to calculate beta with CAPM, I've only taken introductory courses for finance, I'm sure there are other ways.

 

the way we did it was just using excel... simply doing:

slope=(range of data of % returns of the stock, range of data of % returns of the market/index) and excel does the rest..

but everyone has a slightly different adjustment and the data they use.. some use weekly, daily, yearly, monthly thats where the biggest difference comes from

 

and how often as GS ratings (or any other ratings, for that matter) accurate? gotta say this is a pretty weak topic for a thread, though some of the discussion isnt bad

 

I stick with the belief that correlation does not mean causation.. and heavily.. how often are any of these anaylst correct we can't predict where the market is going.. but we can have an educated guess..its like an opinion/view you need to formulate on your own.. like for instance "history" shows us everytime interests rates go up the market goes down...

i told all my buddies that the market will go up with the fed raised rates... and guess what it did, my reasoning behind it was because it would show that the economy is getting on track (and with the latest jobs report 1/8/2016 it clearly is picking up).... so where does our data show-up for that..the market takes in so many factors we can't describe its unreal.. and we also should take into account the "market efficient theory" into our perspectives when purchasing equities... but not heavily rely on it

 

not a great image, but this goes against your interest rate and market theory:


and some forms of the EMH would dictate that the market prices in the probability that the fed makes the decision to increase interest rates the millisecond it gets announced that they're considering it, so it's unsurprising, per the EMH, that the market didn't respond on the day that the decision was made to raise interest rates itself

 

The market did well after the feds raised rates because it was already incorporated into the market because it was basically certain. The market wasn't going to retract when news thats already factored in gets dropped

 

the problem with that image is that it is yearly.. im referring to the anouncement and day-of of the announcement of fed rate.. if you look back all the way into the 80s you can see what happens on the days of; i came accross this information in a book called "stock market logic" by norman G fosback, its an interesting read even though it is dated, but a lot of the concepts still apply to today...

and the other factor in this was that the market was open while the fed rate was announced.. we actually watched in my finance class and saw how the market reacted instantly.. the second it was announced the market shot up +130 points.. EMH (in work) and this was on a friday.. the irony in this is over the weekend it happen..analysts and investors became worried because historically the fed will tend to continue to raise rates after its first one(which is completely idiocracy to me because of the state we are in) and when monday came the market dropped around 200 points..

I don't believe it was already incorported into the market.. and it was not certain at all.. because the first time they met in 2015 the fed declined rates by a 7-1 vote.. (7 said no and 1 said yes)... and they could have easily did the same on the next one..and the market dropped almost 200 points the day it was declined the first time (in 2015).. but what is funny is that a leaked document was released on the internet about intentions of raising rates and the outlook of the economy back in june but it did not make big news.. many analysts were actually betting that the decemeber rate hike would not happen it would actually occur anywhere from january-march of 2016


in other news-- i really recommend everyone to see the big short on the 2008 financial crisis; it was a really good movie, it was slow in the begining but it really picks up they did a nice job explaining everything for the average listener and i guess CDOs are back http://www.bloomberg.com/news/artic...y-hedge-funds-pinning-hopes-on-smallest-banks i ended up hearing about this in the movie and decided to look it up

 

This is true the Pigs

 

if you really dont think it wasnt already incorporated into the market you're delusional. The market was so prepared for the interest rate that it didn't batter an eye

 

So after this post, i'm not going to bother to respond to you, because you clearly don't understand was market efficiency is..and trying to insult someone because they don't agree with you is not a proper manner to even attempt to get a point across...

but let me put it simply what market efficient theory is... just briefly.. basically in my own words for you is that: any and all data that is available to the public and has already occurred is reflected in the price of the market. The market could not have even entertained that idea because simply the FED decision had not happened yet and therefor could not be interrupted into the market... The only way ANYONE could have known what the decision of the fed was going to be is simply if you were part of the fed... or knew someone in the fed.. and had you had the information and made a bet on the market (an option) you would be held in court for insider information... Now you could have made a bet (an option) or purchased the index or shorted the index or whatever you wanted.. but you would not have known with certainty what the FED was going to do unless stated above..
Now onto your ignorant approach of the market being prepared... let me define for you what the "market" really is....

"In this market, buyers and sellers come together to buy and sell stock or shares in companies."

http://learnmoney.org/saving-and-investing/the-market.html

So "the market being prepared" is completely out of the picture because as stated before..if many investment firms, hedge fund managers, analysts, regular people, regular investors.. were SPLIT on whether or not the fed would have raised rates or not. the Market was therefor NOT PREPARED at all.. because of what the market is composed of. I suggest you go check out bloomberg, marketwatch, wsj, nyt, mad money, cnn, to go read all the articles regarding how people were expecting the fed to decline rates a 2nd time and people were actually putting bets (options) on the fed raising rates in january, febuary, march.

But anyways.. here is how market efficiency theory is... if you care to take a read...

http://paste.ee/p/jfJUC --> courtesy of my finance class at Bryant University.

Anyways great discussion everyone.... Really enjoy how many people actually are interested in finance & the markets, that's a great sign!




"In efficient markets, prices become not predictable but random, so no investment pattern can be discerned. A planned approach to investment, therefore, cannot be successful."