What’s currently taking First Solar (FSLR) down over 10 points (~4%) today? Possibly Jim Cramer’s TheStreet.com analyst Larsen Kusick:
First Solar, on the other hand, is trading at almost 50 times 2009 expectations. This multiple may seem attractive relative to the high rate of expected earnings growth of over 96%, but I’m more concerned with the sustainable five-year earnings growth rate. Can FSLR sustain a 50% growth rate, so that a PEG ratio (P/E divided by five-year earnings growth) would be around 1.0? I’m not quite sold on the health of the solar industry over that long of a period, and although you can make a case that the market leader deserves a premium multiple, it looks awfully steep to me. I also have to agree with Jim Cramer’s concerns over the large insider sales by CEO Michael Ahearn.
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