I wrote about oil refiners – and the phenomenal performance of their stocks – on Monday. Today I'm writing about another energy sector that has been hot the last few weeks; namely, solar stocks.
Let's take First Solar (Nasdaq:FSLR), for example. Here's a stock that's gone from $70/share 6 months ago to $40/share 1 month ago, and now almost back to $60.
FSLR's all-time high is over $300, back in the summer of 2008. The stock spent the rest of '08 crashing, but then stabilized until February 2011, when FSLR peaked around $175 before crashing all the way to $12 in May 2012 (see chart from Yahoo! Finance, below). From that low point, FSLR enjoyed a nice, even, steady uptrend for the next 2 years. On June 20, 2014, when oil peaked at just above $107/barrel, FSLR was trading around $70 per share. FSLR's $30 haircut from June 2014 – January 2015 almost perfectly coincided with oil's big decline. Solar investors, of course, understand that solar becomes a more attractive energy alternative when oil prices are high, and vice versa. Continue reading "Solar Stocks Heat Up"→
Yesterday I talked about Tesla (NASDAQ:TSLA) and how this company could skyrocket based on the potential high prices at the pump and the potential lack of availability of petroleum products.
Today I am going to be taking a similar view, but with a different company, First Solar Inc. (NASDAQ:FSLR). When this company first came on the scene, it moved dramatically higher and in a matter of months was trading well over $300 a share, back in 2008. Since that time, the stock has generally drifted lower for the last several years until hitting a low in June of 2012. After trading below $12, the market has made a steady recovery to where we are today, around $70 a share. I certainly hope no one out there has been holding onto any shares since $300.
I am bullish on FSLR based on a number of factors. The Trade Triangles are all positive, we are in a strong uptrend, and this market could complete a classic Fibonacci retracement that would take it back over the $100 a share level. This stock has also shown a remarkable cyclic tendency and we are presently in a cyclic up-cycle right now.
As I stated in my piece on Tesla, the energy problem is going to remain and probably will deteriorate as the Middle East could go down in flames.