First Solar: The rising Sun in a new electricity supercycle

Differentiated solar technology + US manufacturing is a winning combo in a growing electricity demand age

Welcome to the 26th investment case, 13th reshoring/sovereignty, 12th AI & data center and 8th electrification & grids idea on Crack the Market (and the most comprehensive First Solar investment case you will find online)! Join me as I dissect the US solar manufacturing champion, coming out of the IRA review unscathed and ready to meet the growing electricity demand from the electrification of society, AI data centers and reshoring.

Twice a week, I will release deep dives into stocks and sectors that fit into the three themes that I see winning in this age of tariffs and deglobalization: resilience, sovereignty & reshoring, China. I will then deep dive into the opportunities in the AI data center value chain.

Take advantage of this once in a generation opportunity to build long term wealth by investing in great stocks that will deliver returns for your portfolio for years to come.

You can already read my first 24 deep dives, all of which I see as winners in this new world of tariffs and deglobalization:

• ASML (reshoring & China idea): The most innovative company in the world will 2.5x its EPS by 2030.

• LKQ (resilience idea): The most defensive business in the auto industry is a tariff winner and could become a compounder.

• Atlas Copco (resilience, reshoring & China idea): The best industrials business in the world is on sale, extremely resilient and will benefit from US reshoring.

• Badger Meter (resilience idea): The perfect business in the perfect end market, water meters are the definition of resilience.

• Knorr Bremse (resilience idea): Who knew making brakes was this lucrative? Rerating with self help story and upside from German infra plan.

• Flex (reshoring idea): The electronics manufacturing giant building Nvidia’s servers and enabling reshoring is becoming a better business.

• Itron (resilience & reshoring idea): Riding the grid investment super cycle and enabling smart grids.

• Roper (resilience idea): A resilient cashflow compounder in the software space with inflecting growth.

• RELX (resilience idea): The company to own forever – one of the very best businesses on Earth.

• CPKC (resilience & reshoring idea): The rail connecting Canada/US/Mexico and benefiting from reshoring.

• Novo Nordisk (resilience idea): The most exciting pharma company in the world is misunderstood and its growth engine is ready to roar back to life.

• Kurita (resilience, reshoring & China idea): Water services expert with improving margins and benefiting from reshoring of semiconductor production.

• Halma (resilience idea): High quality compounder in safety, health and environmental technologies.

• Quanta Services (resilience & reshoring idea): Countercyclical compounder riding a multi decade infrastructure buildout.

• Infineon (China idea): Power semiconductor leader with strong structural drivers (AI power and China auto) amidst a cyclical recovery.

• Hubbell (resilience & reshoring idea): Pure play on US electrification demand driven by AI and grid investment cycle.

• Iberdrola (resilience & reshoring idea): Best integrated utility in the world with a stellar track record and solid growth driven by networks and renewables

• Nvidia (AI & data center idea): The backbone of the AI world is unstoppable.

• Veolia (resilience & reshoring idea): Resource management giant (water, waste, energy) due for a rerating.

• TJX (resilience idea): The retail giant that keeps winning.

• DSM-Firmenich (resilience idea): The diversified ingredient powerhouse benefiting from a transformational deal.

• Zoetis (resilience idea): Leader in animal healthcare.

• Prysmian (reshoring idea): Global cable leader entering a golden age.

• Bentley Systems (resilience & reshoring idea): The software compounder bringing infrastructure into the AI age.

• Givaudan (resilience idea): The highest quality and most resilient ingredient compounder has a compelling valuation.

After reading this article, you will understand why this company is so special thanks to its unique fully integrated US solar manufacturing base, why the recent tax bill, feared by many investors, has only strengthened its position, why it is benefiting from a decades long load growth megatrend in the US and why it remains one of the best businesses to own for the next decade.

In this article I go through:

1. First Solar’s business and how it dominates the solar manufacturing industry in the US.

2. How the company has transformed from a small US solar manufacturer into the engine behind American electricity generation and one of the most profitable businesses in the world.

3. How it came out of the feared IRA review unscathed, giving the company a very strong position thanks to its manufacturing credits.

4. How its very experienced management team continues to methodically execute, creating a Western solar champion riding a load growth megatrend (accelerated by the AI data center buildout).

5. Why the recent disappointing and conservative results creates an attractive opportunity.

First Solar Investment Case