First Solar (NASDAQ:FSLR) was cut to Peer Perform from Outperform by Wolfe research analysts, who also removed the firm's price target on the stock in a note Monday.
Analysts said they are stepping to the sidelines as the stock approaches the firm's prior price target of $235. It closed Friday's session at over $231 after a more than 26% rally.
"The stock rose 26.5% on Friday on constructive Treasury guidance on domestic content and we think short covering," explained analysts, who also removed the stock from the "Wolfe Alpha List."
"The move was much larger than expected. FSLR stock has more than fully recovered from the sell-off post-earnings and is at a new 15-year high. The stock has outperformed the TAN by 59% YTD after 77% outperformance in 2022," they added.
The firm continues to find the story attractive on earnings growth, positioning into a recession given significant contracting, and as an anti-China play. However, analysts believe it has become "more challenging to argue for material upside on fundamental valuation."