Analysts give their reasons why First Solar's CFO resignation isn't a red flag, from FSLR's management structure to DoE-backed project progress.

August 17, 2011 - Whenever a public company's CFO leaves, investors' snap-judgment is usually that it's (at best) undesirable uncertainty, and (at worst) a sign of bad things to come. And so it is with First Solar, which announced the departure of Jens Meyerhoff after markets closed on Tues. 8/16; the stock is down -6% as of midday Weds. 8/17.

Jens joined FSLR as CFO in 2006 and steered through its subsequent IPO, then helped create and helm the company's utility systems business. (James Brown, SVP of that biz who joined in 2008 as VP of project finance, will take over that role; Frank DeRosa, founder/CEO of NexLight Renewable Power which FSLR bought in 2010, will expand his role as SVP of bizdev.) Jens said that FSLR has "reached a size and scale that allows me to step back and self-reflect before deciding my next step in life."

Jens was "extremely instrumental in building the company from both a financial and strategic perspective," notes Citi's Tim Arcuri. His departure also essentially completes a "full management overhaul" begun by CEO Robert Gillette who took over in 2009 (COO Bruce Sohn left in April 2011). In fact, Credit Suisse's Satya Kumar wasn't surprised by the news, saying that Gillette's "flat org structure" probably hastened some execs' exits, and speculates that nonexec board member Mike Ahearn will likely leave soon too.

While Jens departure is "unfortunate" given FSLR's three major projects needing DoE loan closures, analysts seem to agree there's nothing to be concerned about. Citi's Arcuri says the aforementioned DoE projects (AV Solar Ranch, Desert Sunlight, and Topaz Solar) are "very much on-track;" both he and Kumar expect positive news on projects within a few weeks.

"Granted this is a completely different team than the one that led FSLR to its initial success post IPO," Kumar writes, "but companies and management do evolve through their life cycles. We do believe this team has the skill set to control best what it can in this oversupplied environment."

Not everyone's seeing the trees for the forest, though. Though Goldman Sachs' Mark Weinkes predicts "sharply accelerating results" in 2H11, he's removed FSLR from the firm's "conviction buy list" (he also dinged MEMC, SunPower, and a host of others), citing "idiosyncratic factors affecting each company," macro concerns about the solar and cleantech sectors in general, and "a preference for other areas" including commodities and other industrial stocks.