First Solar (NASDAQ: FSLR) — Trade Policy Could Unlock Significant Upside
First Solar (NASDAQ: FSLR) trades around $225 after a difficult start to the year, with shares down roughly 14%. While sentiment has been weak, we think investors may be overlooking a potential catalyst that could materially improve the company’s long-term outlook.
The opportunity centers on U.S. trade policy.
The U.S. Department of Commerce is still conducting its Section 232 investigation into imported polysilicon, a critical material used to manufacture solar panels, semiconductors, and other technologies. The investigation, which began in July 2025, could ultimately shape how the U.S. handles polysilicon imports going forward.
If regulators determine that imported polysilicon does not pose a national security threat, access to the material could widen, creating a meaningful tailwind for domestic solar manufacturers.
That could be particularly beneficial for First Solar.
A more favorable supply environment has the potential to improve solar panel pricing and strengthen the company’s earnings outlook over the coming years. Wells Fargo believes the market is underestimating this possibility, noting that a favorable Section 232 ruling could significantly boost average selling prices on bookings beginning in 2028.
The firm recently reiterated its Overweight rating on the stock and raised its price target from $255 to $320, implying approximately 42% upside from recent levels.
What’s interesting is that the broader analyst community is already constructive on the name. Of the 42 analysts covering First Solar, 25 currently rate the stock a Buy or Strong Buy, suggesting many on Wall Street remain optimistic despite this year’s pullback.
For us, the story comes down to an attractive risk-reward setup.
The stock has already absorbed a fair amount of negative sentiment, but a favorable outcome from the ongoing trade investigation could provide a meaningful catalyst that many investors are not fully pricing in today.
While the investigation has yet to conclude, First Solar appears well positioned to benefit if trade policy shifts in a way that improves access to one of the industry’s most important raw materials.
