First Solar ‘s recent pullback has created an attractive entry point, according to JPMorgan. The residential solar energy company’s stock has had a volatile year. After rallying approximately 55% from January to May, the stock has tumbled in recent weeks and is now trading near its January levels. First Solar, along with the broader clean energy market, has faced a crisis of confidence amid fears that higher interest rates will reduce demand for the sector. Analyst Mark Strouse upgraded shares to overweight from neutral in a Thursday note. Meanwhile, he pulled back his price target to $220 from $239, which implies shares surging more than 43% from Wednesday’s close. “We believe the recent pullback tilts risk-reward favorably for a company that has the best visibility into medium-term growth prospects owing to a backlog that stretches into later this decade,” said Strouse. To be sure, he noted that he believes there are still longer-term risks around the stock stemming from the new U.S.-based manufacturing, which has been incentivized by the Inflation Reduction Act’s domestic content guidelines. Nonetheless, “we believe that the stock presents near-term value given the overall space has traded down largely owing to rising interest rates and concerns regarding developer cost/access to capital … which we believe should be relatively less impactful to FSLR given their already secured visibility,” Strouse said. Shares jumped nearly 2% Thursday before the bell. The stock is up just 2.2% for the year. —CNBC’s Michael Bloom contributed to this report.
