North Coast Solar Stocks

October 1, 2009

First Solar to join S&P 500, shares jump 5.7 pct

Filed under: FSLR — Tags: , , , , — Jason @ 7:29 pm

Thu Oct 1, 2009 7:29pm EDT

NEW YORK, Oct 1 (Reuters) – Standard & Poor’s said on Thursday that First Solar Inc (FSLR) will join its flagship S&P 500 stock index (SPX), sending the shares of the solar power company up 5.7 percent in after-hours trading.

First Solar, which is based in Tempe, Arizona, will replace drugmaker Wyeth (WYE) in the index on a date to be announced. Wyeth is being acquired by rival Pfizer Inc (PFE).

The addition of First Solar marks the first pure-play solar company to join the index, said Stuart Bush, managing director at RBC Capital Markets, who rates the company as “sector perform” with a price target of $150 per share.

“It’s an important indication that solar has arrived as a mainstream industry in America,” Bush said.

Joining the index “could only help the company in serving to broaden its investor base.”

S&P also said Rupert Murdoch’s news and media company News Corp (NWSA) will replace Wyeth in the S&P 100 index of the largest blue-chip companies, also on a date to be announced.

The shares of companies joining the S&P 500 often rise because many portfolio managers try to track the index and must buy shares of the companies that become part of it.

First Solar shares rose $8.24, or 5.7 percent, to $152 within minutes of S&P’s announcement after U.S. markets closed. The shares had fallen $9.10, or 6 percent, to $143.76 in regular trading on the Nasdaq.

(Reporting by Jonathan Stempel and Laura Isensee in Los Angeles; editing Bernard Orr and Andre Grenon)

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