Going back to 2022, solar stocks have been on my watchlist as a potential leadership group. My fundamental thesis for a strong move in solar is based on a few themes. First, as energy costs continue to rise, it makes sense for more and more homeowners to look for alternative ways to power their homes. In addition, the war in Ukraine has hastened the demand for solar energy, and President Biden has long been a proponent of pursuing solar energy initiatives as a way to both provide new jobs and to reduce the United States' carbon footprint.
Since the market bottomed in October, I've been on the lookout for sectors and themes to propel the new bull market forward. After the Silicon Valley Bank failure, capitulation hit the market and over the last six weeks, individual stock action has started to improve.
One of the stocks I have been watching extremely closely has been First Solar (FSLR). There are few things that struck me about FSLR. First and foremost, the strong accumulation that began last summer is a clear sign of institutional demand. As William O'Neil used to say, "That's not Aunt Betty buying." Moreover, while First Solar currently does not show strong earnings growth, it has delivered accelerating sales and is estimated to produce monster annual earnings in both 2023 and 2024. In addition, the ascending base pattern that FSLR formed during the bear market shows the unrelenting appetite for this stock. I purchased FSLR on April 17 and will look to add to my position should I get an opportunity for a pyramid buy.
Risk right. Sit tight.
Full Disclosure: I currently own FSLR.
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