According to Barron’s, former head of Quark (a famous software firm), #Farhad “Fred” Ebrahimi, recently purchased more than $85 million worth of #First Solar (#FSLR) shares. The price per share as of June 18, 2018 is $51.83 – and the stock price recently dropped 20 percent, according to The Motley Fool. The plunge came as a surprise to many investors in #solar, but it was actually caused in part by a move made by China. The country cut solar incentives for the remainder of the year, and it is anticipated that this move could lessen solar installations in China by a whopping 40 percent.
So, if investors are moving away from the stock, why did someone buy more than $85 million more in shares?
To start, First Solar was not the only stock to drop recently in price per share. The plunge seemed to occur across the industry, impacting stocks such as SunPower (SPWR), too. There has to be a good, solid reason for a person to risk so much money in a market that saw loss. Let’s start with the basics.
First off, what is First Solar?
First Solar is a company based in Tempe, Arizona that manufactures solar power modules. It is known as a semiconductor manufacturing company. It provides utility-scale PV power plants, too. As per Firstsolar.com, the company boasts the most tested and reliable module on the market and its thin film photovoltaic modules (or PV modules) are made with the use of less water, #energy and semiconductor material. The result is the best environmental profile in the solar or renewable energy industry. First Solar also offers global recycling services for its photovoltaic modules. When it comes to advanced methods and innovative concepts, First Solar certainly has a lot going for it.
But this doesn’t mean that the company’s stock won’t be negatively impacted at times because of moves beyond its control. When stock prices drop, people tend to either panic and sell for fear of losing even more money, or they decide to jump in and “buy the dip.” Some might have insider information that others simply don’t have. When a person buys $85 million in shares of any one stock, the world has to wonder – why? Do they know something we don’t know? Or are they able to see the bigger picture?
Farhad Ebrahimi and his wife, Mary Wilkie Ebrahimi bought 1.25 million more shares of First Solar when the share prices dropped recently. They made their investment over a period of almost two weeks – between April 7th and June 8th. Over this time frame, they paid an average price of $67.98, which is considerably higher than the cost per share as of the time of this writing. How much, exactly, do they own of this solar stock? They are the owners of six and a half million shares, as per Barron’s.
Could First Solar Get Acquired By Another Huge Company?
Earlier this year, an article was published by The Motley Fool indicating there are reasons General Electric (#GE) should purchase First Solar. It is recognized that investors are attempting to figure out which solar stocks are going to see long-term growth and come out ahead in the future. It was mentioned in this particular article that General Electric could end up becoming a big player in the world of solar. Why? Well, the company has reduced spending on fossil fuel power plants. It has invested more money in clean energy such as wind turbine technology. When it comes to the solar industry, First Solar seems to have similar positions to GE as it relates to clean energy.
There is a great deal of speculation occurring, but could it be that First Solar could end up merging with another huge company? Could it be we are just seeing the bigger picture, that solar and renewable, clean energy really are the future?
While we don’t have all the answers, the fact is there is a great deal of interest in the solar industry. Investors are, at the very least, considering acquiring shares of solar companies. Keep following solar news – and the solar #stock market – to see what happens!