First Solar (FSLR)
It’s like year 2000 all over again! Have you seen p/e ratios like this recently?
FIRST SOLAR, INC.(NasdaqGS: FSLR)
Last Trade: $278.57
Market Cap: 22.20B (!)
Revenue: $600M (!)
P/E: 110.81
EPS: $2.51 (!)
FSLR fans say that it’s a revolutionary new industry, and if you were so cautious with P/E ratios you’d also miss on Google’s ride up.
The thing is, Google came up on the second Internet wave, when a lot of dot com pitfalls were clear. Solar power generation is still an uncharted territory. The risks are numerous:
- FSLR solar panels are made with the rarest stable element on earth – tellurium
- tellurium is not only rare, it’s toxic; at a later date it may be found that any environmental benefit gained doesn’t outweight its risk
- solar industry relies on government subsidies which can dry up any time; case in point – just this week, German government proposed to cut their subsidies by 30%
And seriously, who in their right mind would pay up to $300 for a stock with that kind of earnings? Any future growth potential is built-in a hundred times over. Speculator’s paradise, until it isn’t.
Why would tellurium be any different than mercury or asbestos? Grab the profits up front and deal with the fallout of the environmental issues, (fees, pollution, death,) at a later date.
Then, they’ll make money on the clean up after this. You think that’s the plan?
I read that they cut the trees in the U.S. to make room for solar panel fields. Crazy.