Alternative Energy ETFs to Gain From First Solar Q4 Results

Leading U.S. solar-panel manufacturer, First Solar FSLR reported fourth-quarter 2017 results after the closing bell yesterday. The company reported narrower-than-expected loss and raised its full-year outlook despite lagging revenue estimates.

Loss per share was 25 cents, narrower than the Zacks Consensus Estimate of 32 cents. First Solar had posted earnings of $1.24 in the year-ago quarter. Revenues inched up 2.4% year over year to $339.2 million but fell shy of the estimate of $434 million (see: all the Alternative Energy ETFs).

For 2018, the company raised its revenue guidance from $2.3-$2.5 billion to $2.45-$2.65 billion and earnings per share guidance from $1.25-$1.75 to $1.50-$1.90. The new guidance is well above the Zacks Consensus Estimate of $2.42 billion for revenues and $1.49 for earnings.

Despite the upbeat outlook, shares of this thin-film solar PV maker dropped 2.3% in after-market hours yesterday.

ETFs in Focus

Given this, ETFs having larger allocations to this solar giant have been in focus and could make great plays over the coming days. FSLR currently has a Zacks Rank #2 (Buy) and a solid Growth and Momentum Score of A each. Below we have highlighted the ETFs in detail:

Guggenheim Solar ETF TAN

This ETF follows the MAC Global Solar Energy Index, holding 27 stocks in the basket. First Solar occupies the top position with 9.9% share. American firms dominate the fund’s portfolio with nearly 25% share, followed by China (20%) and Hong Kong (11%). The product has amassed $402.9 million in its asset base and trades in solid volume of around 273,000 shares a day. It charges investors 70 bps in fees per year and has a Zacks ETF Rank #3 (Hold) with a High risk outlook (read: Trump's Import Tariffs: ETF & Stocks in Focus).

First Trust NASDAQ Clean Edge Green Energy Index Fund QCLN

This fund tracks the Nasdaq Clean Edge Green Energy Index and manages assets worth $93.4 million. It charges 60 bps in fees per year and trades in a light volume of around 31,000 shares per day. In total, the product holds 36 U.S. securities with First Solar taking the third spot with 7.6% allocation. Semiconductors dominate this ETF, accounting for 28% of the assets while renewable energy equipment, electrical components & equipment, and alternative electricity round off the next three spots with a double-digit allocation each. The product has a Zacks ETF Rank #3 with a High risk outlook.

VanEck Vectors Global Alternative Energy ETF GEX

This ETF provides global exposure to stocks that are primarily engaged in the business of alternative energy by tracking the Ardour Global Index. The fund holds about 31 stocks in its basket with AUM of $91.6 million while charging 62 bps in fees per year. Average daily volume is paltry for this fund at around 5,000 shares. First Solar occupies the fourth position in the basket with a 7.2% share. In terms of country exposure, the fund is skewed toward the United States with a 54% share, followed by Denmark and Sweden (read: Trump's 2019 Budget Blueprint: ETF Winners & Losers).

iShares Global Clean Energy ETF ICLN

This fund provides global exposure to 29 clean energy stocks, including solar, wind and other renewable sources, by tracking the S&P Global Clean Energy Index. Out of these, FSLR occupies the top spot at 6.8% of the assets. It has amassed $152.4 million in its asset base while volume is also moderate at about 95,000 shares. United States and China take the top two spots in terms of country exposure with 29.4% and 27.7% share, respectively. The ETF charges 48 bps in annual fees and expenses.

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ISHARS-GL CL EN (ICLN): ETF Research Reports
 
GUGG-SOLAR (TAN): ETF Research Reports
 
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VANECK-GLBL AE (GEX): ETF Research Reports
 
First Solar, Inc. (FSLR) : Free Stock Analysis Report
 
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