Munger Mode rating: 2 out of 5 — Sell. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
We have spent our lives looking for businesses that would prosper whether Congress was in session or not. First Solar is a well-run, honestly managed, financially conservative company — and we want to say that plainly at the outset, because what follows is going to sound harsh. But the arithmetic is unavoidable: in the first half of 2026, First Solar recognized $862.5 million of Section 45X manufacturing tax credits as a reduction of cost of sales, against pre-tax income of $813.7 million. The entire profit of this enterprise, and then some, is currently a check written by the United States Treasury. That check is legislated to shrink by 25% per year starting in 2030 and disappear after 2032, and it could be revised by any future Congress before then. Charlie used to say that when you mix raisins with turds, you've still got turds.
Recent filings analysed: 8-K (2026-07-30), 10-Q (2026-07-30), 8-K (2026-05-15), 8-K (2026-04-30).
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