First Solar (NASDAQ: FSLR) saw its price target lowered by Barclays, with analyst Christine Cho reducing the firm’s 12-month outlook to $213 from $228 while maintaining an Overweight rating on the stock on April 20, 2026.
Shares were trading at $189.50 in pre-market at the time of publication, leaving room for upside despite the revised target. With a price-to-earnings ratio near 13, Barclays continues to view the stock as attractively valued relative to its earnings potential.
Margin recovery expected but dependent on policy outcomes
Barclays expects First Solar’s gross margins to improve from around 7% this year to approximately 12% to 13% next year, reflecting gradual operational recovery.
However, the firm noted that a return to more normalized margin levels, closer to 20%, will depend on favorable developments around Section 232 tariffs and Foreign Entity of Concern (FEOC) regulations, both of which remain key variables for the company’s cost structure and competitiveness.
For context, First Solar reported a gross profit margin of 41% over the past twelve months, although Barclays emphasized that this figure reflects different accounting and operational dynamics than forward-looking margin expectations.
Rising costs pose near-term risks
In the near term, Barclays flagged several headwinds that could weigh on profitability. Rising shipping and logistics costs, alongside broader inflation in raw materials, continue to pressure margins for solar manufacturers.
These cost dynamics, combined with ongoing geopolitical tensions, are expected to remain a source of volatility for the sector in the coming quarters.
Mixed analyst reactions follow weaker outlook
The latest adjustment comes after First Solar’s Q4 2025 earnings report, which delivered an outlook below expectations, largely due to tariff-related pressures.
Following the results, RBC Capital Markets reiterated an Outperform rating with a $236 price target, maintaining a more bullish stance despite recent stock weakness.
At the same time, Jefferies lowered its price target to $187 from $205 while keeping a Hold rating, citing concerns over rising logistics costs and inflationary pressures tied to Middle East disruptions.
Meanwhile, Guggenheim Partners reduced its target to $269 from $312 but maintained a Buy rating, reflecting adjustments to its financial model following the earnings release.
First Solar outlook valuation attractive but risks remain
Despite the revised price target, Barclays maintains a constructive view on First Solar, supported by its valuation and long-term positioning in the solar energy market.
However, the path to margin expansion remains dependent on both operational improvements and external policy factors, leaving the stock exposed to near-term risks even as analysts continue to see upside over the longer term.
