By Porter Stansberry in the S&A Digest:

This morning [Friday], shares of First Solar (FSLR) were down 10%, as the company's profit outlook was significantly weakened because of lower prices for competing polysilicon-based solar panels, especially in the German market. Says First Solar CEO Mike Ahern: "[T]here are several factors. One was certainly project and channel competition with the aggressive crystalline silicon pricing coming into the market. There is no question that had some impact."

By the way... The press reports about First Solar's earnings were way off. Most news reports said the company's earnings were great. But that's only because the company had lowered guidance previously.

What really mattered in the numbers was the huge trouble polysilicon competition is causing for First Solar. In fact, in Germany, First Solar has put a rebate scheme in place to make sure its panels are the same price as their competition. The problem is, First Solar can't reduce its costs as much as the polysilicon makers can, so the future is bleak. And apparently the market makers bulled the stock up overnight, based on the naive news headlines. According to subscribers, the stock went as high as $189 in after-hours trading - before opening down at $155.

Crux note: The S&A Digest comes free with a subscription to Porter Stansberry's Investment Advisory. In this month's edition, Porter is recommending a stock that he believes to be his best pick in three years. Shares will have to triple in order to reach their intrinsic value. To learn more, click here...

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