It has been about a month since the last earnings report for First Solar (FSLR Quick QuoteFSLR - Free Report) . Shares have added about 8.8% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is First Solar due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

First Solar Q3 Earnings Beat Estimates, Sales Rise Y/Y

First Solar reportedthird-quarter 2023 earnings of $2.50 per share compared to the prior-year quarter’s loss of 46 cents per share. Earnings beat the Zacks Consensus Estimate of $2.09 per share by 19.6%.

Sales Update

First Solar’s third-quarter net sales were $801.1 million, which lagged the Zacks Consensus Estimate of $901 million by 11.1%. However, the top line improved by 27.4% from the year-ago quarter’s $628.9 million.

Operational Highlights

In the third quarter, the gross profit totaled $376.2 million, which improved massively from $20.9 million in the year-ago quarter.

Total operating expenses increased 8.5% to $103.4 million due to higher research and development costs and SG&A expenses.

FSLR reported an operating income of $272.9 million compared to the operating loss of $61.7 million in the year-ago quarter.

Financial Performance

First Solar had $1,492.9 million in cash and cash equivalents as of Sep 30, 2023, up from $1,481.3 million as of Dec 31, 2022.

The long-term debt totaled $464 million as of Sep 30, 2023, compared with $184.3 million as of Dec 31, 2022.

2023 Guidance

First Solar updated its 2023 earnings guidance. FSLR now expects earnings in the range of $7.20-$8, up from the prior guidance in the band of $7-$8 per share. The Zacks Consensus Estimate for 2023 earnings, pegged at $7.68 per share, is higher than the midpoint of the company’s guidance range.

First Solar expects sales in the range of $3.4-3.6 billion in 2023. The Zacks Consensus Estimate for 2023 sales stands at $3.50 billion, in line with the midpoint of the guided range.

First Solar expects gross profit in the range of $1.2-$1.3 billion. The operating income is now anticipated in the band of $745-$870 million.

Meanwhile, First Solar expects shipments in the band of 11.8-12.3 gigawatts in 2023.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended downward during the past month.

VGM Scores

Currently, First Solar has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, First Solar has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

First Solar is part of the Zacks Solar industry. Over the past month, Enphase Energy (ENPH Quick QuoteENPH - Free Report) , a stock from the same industry, has gained 31.6%. The company reported its results for the quarter ended September 2023 more than a month ago.

Enphase Energy reported revenues of $551.08 million in the last reported quarter, representing a year-over-year change of -13.2%. EPS of $1.02 for the same period compares with $1.25 a year ago.

For the current quarter, Enphase Energy is expected to post earnings of $0.63 per share, indicating a change of -58.3% from the year-ago quarter. The Zacks Consensus Estimate has changed -16.2% over the last 30 days.

Enphase Energy has a Zacks Rank #4 (Sell) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.