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First Solar Provides Performance Update at Piper Jaffray CleanTech Conference (FSLR)

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February 20, 2008 11:57 AM EST

First Solar (Nasdaq: FSLR) CFO, Jens Meyerhoff, recently presented at the 3rd Annual Piper Jaffray CleanTech and Renewables Conference. The exec gave investors who attended insight into First Solar's international expansion progress, as well as an update on many important metrics for the solar company.

Meyerhoff reiterated that a large plant in Malaysia is on track to to begin production relatively soon and, based on pictures of the plant that were presented, Piper Jaffray believes the First Solar facility has already begun product qualification. Meyerhoff said First Solar is determined to lower costs at the Malaysian plant by 0.40 $/watt due to cheaper labor and lower tax rates. Interestingly, First Solar sees expansion into Malaysia practical, but believes that further expansion into China appears unlikely given "IP concerns."

Going on, Meyerhoff informed investors that First Solar is not experiencing slower demand for its solar modules related to the credit crunch. The Company reiterated its long-range target of 20% return on net assets, implying operating profit of 25%.

Piper Jaffray said that First Solar's goal of 12% efficiency, which was reiterated by Meyerhoff at the conference, seems conservative as the Company has already demonstrated that it can achieve 14.5% efficiency in the same device structure. Furthermore, Piper Jaffray noted that its proprietary checks have confirmed that First Solar's modules deliver the best kwh performance with the lowest defect rates.

Piper Jaffray currently has a Buy rating and $280 price target on First Solar. The firm said its price target is based on 40x its new 2010 pro forma EPS estimate of $8.24, with a discount rate of 15%.