Market Cap | 7.62 B | P/E(ttm) | 21.60 |
---|---|---|---|
Enterprise Value | 12.17 B | P/B | 8.90 |
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Ticker | Company Name | Financial Strength | Market Cap (M) |
---|---|---|---|
SVLT | Sunvault Energy Inc | 8/10 | 66.80 |
FSLR | First Solar Inc | 8/10 | 6,086.71 |
RGSE | Real Goods Solar Inc | 7/10 | 13.99 |
SOPW | Solar Power Inc | 7/10 | 1,168.80 |
SPWR | SunPower Corp | 7/10 | 4,116.65 |
SCTY | SolarCity Corp | 5/10 | 4,954.24 |
VSLR | Vivint Solar Inc | 4/10 | 1,278.38 |
SLTD | Solar3D Inc | 4/10 | 65.83 |
QTMM | Quantum Materials Corp | 4/10 | 43.41 |
EENR | Elite Energies Inc | 4/10 | 40.50 |
ASTI | Ascent Solar Technologies Inc | 4/10 | 28.19 |
Ticker | Company Name | Profitability Rank | Market Cap (M) |
---|---|---|---|
FSLR | First Solar Inc | 6/10 | 6,086.71 |
RGSE | Real Goods Solar Inc | 4/10 | 13.99 |
SPWR | SunPower Corp | 4/10 | 4,116.65 |
QTMM | Quantum Materials Corp | 4/10 | 43.41 |
SVLT | Sunvault Energy Inc | 4/10 | 66.80 |
SLTD | Solar3D Inc | 3/10 | 65.83 |
EENR | Elite Energies Inc | 2/10 | 40.50 |
SCTY | SolarCity Corp | 2/10 | 4,954.24 |
VSLR | Vivint Solar Inc | 2/10 | 1,278.38 |
SOPW | Solar Power Inc | 2/10 | 1,168.80 |
ASTI | Ascent Solar Technologies Inc | 2/10 | 28.19 |
The Net-Net Working Capital Per Share of First Solar Inc for the quarter that ended in Dec. 2014 was $7.05
In calculating the Net-Net Working Capital (NNWC), Benjamin Graham assumed that a companys accounts receivable is only worth 75% its value, its inventory is only worth 50% of its value, but its liabilities have to be paid in full. In addition, Graham believed that preferred stock belongs on the liability side of the balance sheet, not as part of capital and surplus. In "Security Analysis", preferred stock is dubbed "an imperfect creditorship position" that is best placed on the balance sheet alongside funded debt. This is a conservative way of estimating the companys value.
Net-Net Working Capital | |||||||||||
= | (CashAndCashEquivalents | + | 0.75 * Acct. Rec. | + | 0.5 * Inventory | - | Total Liabilities | - | Preferred Stock) | / | Shares Outstanding |
= | (1991.086 | + | 0.75 * 212.405 | + | 0.5 * 505.088 | - | 1696.952 | - | 0) | / | 100.21 |
= | 7.05 |
For more information about NNWC, visit: Net-Net Working Capital Per Share
The Tangible Book Value per share of First Solar Inc for the quarter that ended in Dec. 2014 was $48.13
Tangible Book Value Per Share | |||||||
= | (Total Equity | - | Preferred Stock | - | Intangibles) | / | Shares Outstanding |
= | (5027.487 | - | 0 | - | 204.221) | / | 100.21 |
= | 48.13 |
Since intangibles such as goodwill cannot be sold when the company liquidates, tangible book value per share is considered more accurate in reflecting how much shareholders will receive when the company liquidates.
For more information about tangible book value per share, visit: Tangible Book Value Per Share
The DCF projected intrinsic value of First Solar Inc for today is $58.48
Since the intrinsic value calculations based on Discounted Cash Flow Intrinsic Value (DCF), or Discounted Earnings (DCE) Intrinsic Value (DE) cannot be applied to companies without consistent revenue and earnings, GuruFocus developed a valuation model based on normalized Discounted Cash Flow and Book Value of the company. The details of how we calculate the intrinsic value of stocks are described here.
This method smooths out the free cash flow over the past 6-7 years, multiplies the results by a growth multiple, and adds a portion of total equity.
Value = ((Growth Multiple)*Free Cash Flow(6 year avg) + 0.8*Total Equity(most recent))/Shares Outstanding
In the case of negative total equity, the following formula is used (see the Total Equity section for the reason):
Value = ((Growth Multiple)*Free Cash Flow(6 year avg) + Total Equity(most recent)/0.8)/Shares Outstanding
Here First Solar Inc's FCF(6 year avg) is calculate as
First Solar Inc Quarterly Data201209 | 201212 | 201303 | 201306 | 201309 | 201312 | 201403 | 201406 | 201409 | 201412 | |
total_freecashflow | -35 | 288 | -5 | 137 | 306 | 136 | -369 | 56 | -118 | 855 |
201003 | 201006 | 201009 | 201012 | 201103 | 201106 | 201109 | 201112 | 201203 | 201206 | |
total_freecashflow | -75 | -57 | 110 | 138 | -213 | -424 | -21 | -107 | -141 | 271 |
200903 | 200906 | 200909 | 200912 | |||||||
total_freecashflow | -23 | -40 | 114 | 345 |
First Solar Inc's DCF Projected Intrinsic Value for today is calculated as
Intrinsic Value | |||||||||
= | (Growth Multiple | * | Free Cash Flow(6 year avg) | + | Total Equity(Dec14) | * | 0.8) | / | Shares Outstanding |
= | (10.1956168062 | * | 187.754 | + | 5027.487 | * | 0.8) | / | 101.514 |
= | 58.48 |
First Solar Inc's Free Cash Flow Growth Multiple is 10.1956168062.
For more information about Projected FCF Intrinsic Value, visit: Intrinsic Value (DCF Projected)
The Median P/S Value of First Solar Inc for today is $150.54
This valuation method assumes that the stock valuation will revert to its historical mean in terms of Price/Sales Ratio. The reason we use P/S Ratio instead of P/E Ratio or P/B Ratio is because Price/Sales Ratio is independent of profit margin, and can be applied to a broader range of situations.
Median P/S Value | |||
= | Revenue Per Share (TTM) | * | 10-Year Median P/S Ratio |
= | 33.38 | * | 4.51 |
= | 150.54 |
10-Year Median P/S Ratio is 4.51.
First Solar Inc's revenue per share for the trailing twelve months (TTM) ended in Dec. 2014 was 9.33 (Mar. 2014) + 5.35 (Jun. 2014) + 8.77 (Sep. 2014) + 9.93 (Dec. 2014) = $33.38.
For more information about median p/s value, visit: Median P/S Value
The Graham Number of First Solar Inc for the quarter that ended in Dec. 2014 was $65.49
Graham Number is a figure that measures a stock's fundamental value by taking into account the company's earnings per share and book value per share. The Graham number is the upper bound of the price range that a defensive investor should pay for the stock. According to the theory, any stock price below the Graham number is considered undervalued, and thus worth investing in.
Graham Number | |||||||
= | SquareRoot of (22.5 | * | (Total Equity - Intangibles) | * | Net Income (Continuing Operations)) | / | Shares Outstanding |
= | SquareRoot of (22.5 | * | (5027.487 - 204.221) | * | 396.918) | / | 100.21 |
= | 65.49 |
For more information about graham number, visit: Graham Number
The Peter Lynch Fair Value of First Solar Inc for today is $0.00
Peter Lynch Fair Value applies to growing companies. The ideal range for the growth rate is between 10 - 20% a year. Peter Lynch thinks that the fair P/E value for a growth company equals its growth rate, that is PEG = 1. The earnings here is trailing twelve month (TTM) earnings. The growth rate we use is the average growth rate for earnings per share over the past 5 years. If 5-Year Earnings Growth Rate is greater than 25% a year, we use 25.
Peter Lynch Fair Value | |||||
= | PEG | * | 5-Year EBITDA Growth Rate | * | Earnings Per Share (NRI) (TTM) |
= | 1 | * | * | 3.9 | |
= | 0.00 |
5-Year Earnings Growth Rate is . If 5-Year Earnings Growth Rate is greater than 25% a year, we use 25..
First Solar Inc's Earnings Per Share (NRI) for the trailing twelve months (TTM) ended in Dec. 2014 was 1.1 (Mar. 2014) + 0.04 (Jun. 2014) + 0.87 (Sep. 2014) + 1.89 (Dec. 2014) = $3.9.
Please note that we use the 5-year average growth rate of EBITDA per share as the growth rate. EBITDA growth is subject to less manipulations than net earnings per share. In the calculation, PEG=1 because Peter Lynch thinks that the fair P/E ratio of the growth stock is equal to its earnings growth rate.
For more information about Peter Lynch fair value, visit: Peter Lynch Fair Value
The Earnings Power Value (EPV) of First Solar Inc for the quarter ended in Dec. 2014 was $0.11.
Earnings Power Value also known as just Earnings Power is a valuation technique popularised by Bruce Greenwald, an authority on value investing at Columbia University. It is arguably a better way to analyze stocks than Discounted Cash Flow analysis that relies on highly speculative growth assumptions many years into the future.
Assumption: Current profitability is sustainable.
Average of Last 20 Quarters | Last Quarter | |
Revenue | 3,080 | |
DDA | 227 | |
Operating Margin % | 6.86 | |
SGA * 25% | 80 | |
Tax Rate % | 5.50 | |
Maintenance Capex | 441 | |
Cash and Cash Equivalents | 1,991 | |
Short-Term Debt | 52 | |
Long-Term Debt | 165 | |
Shares Outstanding (Diluted) | 102 |
1. Start with "Earnings" not including accounting adjustments (one-time charges not excluded unless policy has changed). "Earnings" are "Operating earnings" (EBIT).
2. Look at average margins over a business/Industry cycle: Average Operating Margin = 6.8625%
To normalize margins and eliminate the effects on profitability of valuing the firm at different points in the business cycle, it is usually best to take a long-term average of operating margins. Ideally this would be as long as 10 years and include at least one economic downturn. However, since most of companies do not have as long as 10-year history, here GuruFocus uses the latest 5 years data to do the calculation. To smooth out unusual years but reflect recent developments, we take an average of the 5 year margin.
3. Multiply average margins by sustainable revenues and then adjust for maintenance SGA. This yields "normalized" EBIT:
To be conservative, GuruFocus uses an average of the 5 year revenue as the sustainable revenue.
EPV analysis recognises that part of SGA expenditure is made to maintain and replace the existing assets, while part is made to grow sales. Since EPV is only interested in what it costs a going concern to maintain its existing asset base, it adds back a percentage of SGA (between 15% and 50% - this is a matter of judgment and industry knowledge) to make up for the fact that some of this expenditure went to fund growth and shouldn't be accounted for. To start off, we assume 25% for the sake of prudence.
Sustainable Revenue = $3079.814 Mil, Average Operating Margins = 6.8625%, Average Adjusted SGA = 80.403,
therefore "normalized" EBIT = Sustainable Revenue * Average Operating Margins + Average Adjusted SGA = 3079.814 * 6.8625% +80.403 = $291.75523575 Mil.
4. Multiply by one minus Average tax rate (nopat):
Same as average operating margin calculation, GuruFocus takes an average of the 5 years tax rates.
Average Tax Rate = 5.4965%, and "normalized" EBIT = $291.75523575 Mil,
therefore After-tax "normalized" EBIT = "Normalized" EBIT * ( 1 - Average Tax Rate ) = 291.75523575 * ( 1 - 5.4965% ) = $275.718909217 Mil.
5. Add back excess depreciation (after tax at 1/2 average tax rate). This yields "normalized" Earnings:
Excess depreciation = Average DDA * % of excess depreciation (after tax at 1/2 average tax rate) = 226.8416 * 0.5 * 5.4965% = $6.234174272 Mil.
"normalized" Earnings = After-tax "normalized" EBIT + Excess depreciation = 275.718909217 + 6.234174272 = $281.953083489 Mil.
6. Adjusted for maintenance capital expenditure:
First, calculate the revenue change regarding to the previous year. If the revenue decreased from the previous year, then the Maintenance Capital Expenditure = Capital Expenditure (positive).
Second, if the revenue increased from the previous year, then calculate the percentage of Net PPE as of corresponding Revenue.
Third, calculate Capital Expenditure (positive) - percentage of Net PPE as of corresponding Revenue * revenue increase.
If [Capital Expenditure (positive) - percentage of Net PPE as of corresponding Revenue * revenue increase] was negative, then the Maintenance Capital Expenditure = Capital Expenditure (positive).
If [Capital Expenditure (positive) - percentage of Net PPE as of corresponding Revenue * revenue increase] was positive, then the Maintenance Capital Expenditure = Capital Expenditure (positive) - percentage of Net PPE as of corresponding Revenue * revenue increase.
Fourth, GuruFocus uses an average of the 5 year maintenance capital expenditure as maintenance CAPEX.
First Solar Inc's Average Maintenance CAPEX = $440.6061 Mil.
7. Investors require a return of "WACC" for the risk they are taking: WACC = 9%
8. First Solar Inc's current cash and cash equivalent = $1991.086 Mil.
First Solar Inc's current interest bearing debt = Long-Term Debt + Short-Term Debt = 165.003 + 51.918 = $216.921 Mil.
First Solar Inc's current diluted shares outstanding = 101.514 Mil.
First Solar Inc's Earnings Power Value (EPV) for the quarter ended in Dec. 2014 was calculated as:
EPV | = | ( ( Norm. Earnings | - | Maint. CAPEX) | / | WACC | + | CashandEquiv | - | Int. Bearing Debt) | / | SharesOutstanding |
= | ( ( 281.9531 | - | 440.6061 ) | / | 9% | + | 1991.086 | - | 216.921 ) | / | 101.514 | |
= | 0.11 |
Margin of Safety (EPV) | = | ( Earnings Power Value (EPV) | - | Current Price ) | / | Earnings Power Value (EPV) |
= | ( 0.111843740108 | - | 59.79 ) | / | 0.111843740108 | |
= | -53358.51 % |
For more information about EPV, visit: Earnings Power Value (EPV)
First Solar Inc gross margin has been in long term decline. The average rate of decline per year is -15%.
If a company builds asset at 13.1% a year, faster than its revenue growth rate of 6.6% over the past 5 years, it means that the company may be getting less efficent.
Ben Graham prefers companies interest coverage is at least 5. First Solar Inc has enough cash to cover all of its debt. Its financial situation is stable.
First Solar Inc revenue is in decline over the past 12 months.
Historically First Solar Inc (FSLR) stock has been traded between P/E ratios of 5.016 and 460.615. If the stock had always been traded at P/E of 5.016, its stock prices would have been where the lower red line is. Similarly, if the stock had always been traded at 460.615, its stock prices would have been where the upper red line is. The actual stock prices bounces between these two red lines.
Currently, the P/E ratio of First Solar Inc is 15.50
As always, it is always better if the stock prices is close to the lower red line, which implies that the stock is traded at the lower end of valuation.
For more information about this page, visit: GuruFocus Valuation Charts Now Support iPad/iPhone
Historically First Solar Inc (FSLR) stock has been traded between P/B ratios of 0.318 and 22.33. If the stock had always been traded at P/B of 0.318, its stock prices would have been where the lower red line is. Similarly, if the stock had always been traded at 22.33, its stock prices would have been where the upper red line is. The actual stock prices bounces between these two red lines.
Currently, the P/B ratio of First Solar Inc is 1.20
As always, it is always better if the stock prices is close to the lower red line, which implies that the stock is traded at the lower end of valuation.
You can find the stocks that are traded at close to its historical low P/B valuation here.
Historically First Solar Inc (FSLR) stock has been traded between P/S ratios of 0.379 and 60.541. If the stock had always been traded at P/S ratio of 0.379, its stock prices would have been where the lower red line is. Similarly, if the stock had always been traded at 60.541, its stock prices would have been where the upper red line is. The actual stock prices bounces between these two red lines.
Currently, the P/S ratio of First Solar Inc is 1.80
As always, it is always better if the stock prices is close to the lower red line, which implies that the stock is traded at the lower end of valuation.
You can find the stocks that are traded at close to its historical low P/S valuation here.
Symbol | P/E(ttm) ratio | P/E(ttm) ratio 10-Y Range Chart |
---|---|---|
FSLR | 15.50 | |
SPWR | 21.20 | |
SOL | 0.00 |
Industry Name | FSLR P/E(ttm) ratio Rank | # of Companies | Chart |
---|---|---|---|
Solar | Top 12% | 164 |
Symbol | P/S ratio | P/S ratio 10-Y Range Chart |
---|---|---|
FSLR | 1.80 | |
SPWR | 1.70 | |
SOL | 0.10 |
Industry Name | FSLR P/S ratio Rank | # of Companies | Chart |
---|---|---|---|
Solar | Top 31% | 164 |
Symbol | P/B ratio | P/B ratio 10-Y Range Chart |
---|---|---|
FSLR | 1.20 | |
SPWR | 2.70 | |
SOL | 1.10 |
Industry Name | FSLR P/B ratio Rank | # of Companies | Chart |
---|---|---|---|
Solar | Top 13% | 164 |
Symbol | Price to Free Cash Flow ratio | Price to Free Cash Flow ratio 10-Y Range Chart |
---|---|---|
FSLR | 14.40 | |
SPWR | 0.00 | |
SOL | 0.00 |
Industry Name | FSLR Price to Free Cash Flow ratio Rank | # of Companies | Chart |
---|---|---|---|
Solar | Bottom 49% | 164 |