A Tale Of Two Cities: FSLR Vs. SCTY In The Battle Of The Solar Stock

It was the best of time for First Solar (FSLR - Analyst Report) and it was the worst of times for Solar City (SCTY - Snapshot Report) over the past few days. The Q3 earnings were polarizing for the two companies, with First Solar crushing the earnings estimate for a second quarter in a row and the wunderkind Elon Musk’s Solar City not meeting the earnings estimate figure.

Despite the two solar companies having completely different results for the most recent earnings quarter, let’s take a closer look at First Solar and Solar City to determine which company is potentially the wiser investment to add to your portfolio.

Zacks Rankings

First Solar currently holds a Zacks Rank #2 (Buy) compared to its last weeks Zacks Rank #3 (Hold). In our Style Score grading system, First Solar has a ‘B’ grade for Growth and an ‘A’ grade for Value. The company is also 1st of 17 companies in our Solar Industry listing. First Solar’s PE ratio is also good, currently listed at 17.08.

Solar City, on the contrary, currently holds a Zacks Rank #3 (Hold) compared to its last weeks Zacks Rank #4 (Sell). In our Style Score grading system, Solar City has an ‘F’ grade in both Growth and Value. The company is ranked 6th of 17 companies in our Solar Industry listing. Due to not posting positive EPS figures, the company does not have a listed PE ratio figure.

The Battle of the Zacks Rankings goes to First Solar. The company has quality figures in key Zacks Rankings compared to Solar City.

Earnings

As mentioned earlier, First Solar outperformed our earnings estimate the past 2 quarters. The company didn’t narrowly outperform the estimates, they blew past the figure exponentially.  First Solar outperformed the Q3 earnings estimate by 118.06% and outperformed the Q2 earnings estimate by 642.86%. That second number is simply outstanding.

First Solar Inc. (FSLR - Analyst Report) - Earnings Surprise | FindTheCompany

Solar City’s most recent earnings are not anything to brag about. The company missed/did not outperform our earnings estimate the past two quarters. For the Q3 period, Solar City missed the estimate by 5.53% and met the estimate in Q2.

 

Solarcity Corporation (SCTY - Snapshot Report) - Earnings Surprise | FindTheCompany

The Battle of the Earnings clearly goes to First Solar. Solar City needs to begin posted figures that are at least somewhat outperforming the estimates before investors can feel better about investing into the company.

Revenue & Profits

First Solar outperformed its revenue estimate, posting $1.271 billion in revenue compared to the $1.097 billion estimate figure.

First Solar Inc. (FSLR - Analyst Report) Quarterly Revenue | FindTheCompany

Solar City outperformed the revenue estimate as well, posting $113 million in revenue compared to the $107 million estimate figure.

Solarcity Corporation (SCTY - Snapshot Report) Quarterly Revenue | FindTheCompany

Profits are where the two companies begin to separate. First Solar has been regularly posting profits over the past few quarters compared the Solar City. Solar City, until their Q3 earnings, has had their net losses steadily increasing.

First Solar Inc. (FSLR - Analyst Report) Quarterly Net Income | FindTheCompany

 

Solarcity Corporation (SCTY - Snapshot Report) Quarterly Net Income | FindTheCompany

The Battle of the Revenues & Profits, once again, goes to First Solar. The company appears to be on a healthier trajectory compared to Solar City. Solar City did, however, cut their losses drastically this past quarter. In all, First Solar receives the victory for both outperforming the revenue estimate and posting a profit, a feat Solar City cannot claim.

Final Thoughts

First Solar easily defeats Solar City in the Battle of the Solar Stock. First Solar is outperforming estimates, posting profits, and showing signs of continued growth. If you are potentially looking to invest into this energy sector and debating between these two companies, First City may be the wiser investment.