First Solar (FSLR) Plunges 2.33% Intraday on Senate Bill Sparking Sector Uncertainty

Shares of First Solar (FSLR) fell 0.86% on Thursday, marking a new intraday decline of 2.33% and dropping to their lowest level since October 2025. The selloff reflects growing uncertainty around regulatory shifts and market dynamics in the solar sector.

Recent institutional activity highlighted mixed signals for the stock. While firms like Lannebo Fonder AB and Duality Advisers LP added significant positions, others, including Renaissance Technologies LLC, reduced holdings. Analyst upgrades from Deutsche Bank and Morgan Stanley in late September initially bolstered optimism, but these were overshadowed by a controversial Senate bill proposing to phase out solar tax credits by 2028. This policy shift triggered a sharp sell-off in late September, erasing earlier gains and pushing the stock below its 50-day moving average.

First Solar’s strategic moves, including a $1.1 billion Louisiana manufacturing facility and an expanded 8 GW partnership with Longroad Energy, reinforced its long-term growth potential. The CEO’s advocacy for stricter trade enforcement against Chinese solar competition further underscored the company’s reliance on domestic policy support. However, the Senate bill’s focus on nuclear and geothermal energy, coupled with the elimination of residential solar incentives, raised concerns about the company’s market exposure.

Analysts noted a duality in earnings forecasts. While projections for 47.42% Q3 2024 EPS growth highlighted operational strength, downward revisions to 2023 estimates due to supply chain challenges and softening module prices created near-term volatility. The stock’s valuation also faced scrutiny, with some observers questioning whether its 50% May surge was sustainable amid regulatory risks and profit-taking pressures.

The company’s ability to navigate these challenges will depend on its execution of infrastructure projects, strategic partnerships, and influence over U.S. trade and energy policies. With 93% of its 2023 revenue tied to domestic projects, First Solar remains vulnerable to shifts in federal incentives. Investors are advised to monitor policy developments and earnings performance as key drivers of future stock performance.