03-10-2014, 07:10 AM
One reason for the under-utilization is that First Solar solar panels are not as efficient as Chinese solar companies. The average conversion efficiency for First Solar modules in fourth quarter was 13.4%. This is lower than the average module conversion efficiency of Chinese tier-1 solar companies of 16% and significantly lower than industry-leading SunPower's (NASDAQ: SPWR ) X-Series panels, which have a conversion efficiency of 21.5%.
The relative inefficiency of First Solar's modules is keeping the company away from the current hot area in solar, distributed energy. Distributed energy is currently growing at a very fast rate and investors are bidding up distributed energy companies like SolarCity (NASDAQ: SCTY) and SunPower for their future growth and potential.
Many investors view distributed energy businesses as superior to traditional solar panel makers because distributed energy companies will see their margins increase as solar costs come down. Distributed energy is also insulated from solar panel oversupply, as those companies realize their cash flows from the long-term contracts rather than one-time orders from utility companies.
How Can First Solar Inc Reignite Its Stock?
This about sums it up