On October 2, 2023, Alexander Bradley, the Chief Financial Officer (CFO) of First Solar Inc (FSLR, Financial), sold 5,000 shares of the company. This move is part of a broader trend of insider selling at First Solar Inc, which we will explore in this article.
First Solar Inc is a leading global provider of comprehensive photovoltaic (PV) solar systems. The company's integrated power plant solutions deliver an economically attractive alternative to fossil-fuel electricity generation. First Solar has developed, financed, engineered, constructed, and currently operates many of the world's largest grid-connected PV power plants.
Alexander Bradley has been with First Solar Inc for several years, serving as the company's CFO. His role involves overseeing the company's financial operations, including budgeting, forecasting, and financial planning. His decision to sell shares in the company is noteworthy and could signal his perspective on the company's future performance.
Over the past year, Alexander Bradley has sold a total of 16,000 shares and has not purchased any shares. This trend is not isolated to Bradley alone. The insider transaction history for First Solar Inc shows that there have been 21 insider sells and only 1 insider buy over the past year.
The relationship between insider selling and stock price can be complex. Generally, when an insider sells shares, it could be interpreted as a lack of confidence in the company's future performance. However, it's also important to note that insiders may sell shares for personal reasons unrelated to the company's performance.
On the day of the insider's recent sell, shares of First Solar Inc were trading for $158.23 apiece, giving the stock a market cap of $16.16 billion. The price-earnings ratio is 107.08, significantly higher than the industry median of 23.68 and the company’s historical median price-earnings ratio.
With a price of $158.23 and a GuruFocus Value of $102.60, First Solar Inc has a price-to-GF-Value ratio of 1.54. This suggests that the stock is significantly overvalued based on its GF Value.
The GF Value is an intrinsic value estimate developed by GuruFocus. It is calculated based on historical multiples that the stock has traded at, a GuruFocus adjustment factor based on the company’s past returns and growth, and future estimates of business performance from Morningstar analysts.
In conclusion, the insider's recent sell, along with the broader trend of insider selling at First Solar Inc, could be a signal for investors to exercise caution. The stock's high price-earnings ratio and its overvaluation based on the GF Value further support this view. However, investors should also consider other factors, such as the company's financial performance and market conditions, before making investment decisions.