First Solar, Inc. (FSLR): More Power, Less Space

I worry about First Solar, Inc. (NASDAQ:FSLR) because of the steep rise in guidance, but I think it is in a far better position than SunPower. First Solar is going beyond thin film, and now SunPower looks threatened. As a side note, I think thin film will still be important to First Solar, because they are far more resilient and cheaper. They can be curved for flexibility if necessary, and the toxicity is not an unassailable problem. Even now, it would be unlikely that the cadmium telluride would leak out.

Eye for diversity

Solar might look good, but keep your foot in fossil fuels. So consider investing in natural gas with a hint of oil, such as in Linn Energy LLC (NASDAQ:LINE). Solar, for all its potential, is a growing industry and full of risk. Natural gas might be on the rise and be considered in a growth phase, but I think it is far less risky. The reason is that the U.S. needs a reliable domestic energy source and natural gas offers that, plus the kicker of being more environmentally friendly than gasoline.

Natural gas prices are probably in an uptrend, and over the next few years, are most definitely going to rise. Natural gas is still very low, and that is the reason that Linn is entering oil. Linn Energy LLC (NASDAQ:LINE) has a lot of natural gas production, but its recent acquisition of Berry Petroleum means that Linn will be able to extract some more profitable oil. Right now, oil is facing some issues, but I do not expect them to last forever. The main draw of Linn Energy LLC (NASDAQ:LINE) is the 7.6% dividend yield, which it seems committed to maintaining despite some recent problems.

Conclusion

Energy ties all of these stocks together. Energy is one of the most important things on this planet. If we had a source of massive, cheap, and clean energy, the world would probably be a nicer place. California’s water problems could easily be solved by desalinization, if the energy costs were extremely cheap. Play the field with energy, because there is no quick solution.

First Solar, Inc. (NASDAQ:FSLR) is probably the way to go in solar, but the recent rise worries me. If the guidance is too optimistic, and a miss or a downward revision would send the stock crashing. Linn is a solid dividend stock, though there is a risk of collapse if natural gas or oil collapses.

The article Solar Will Remain on Shaky Ground…At Least for Now originally appeared on Fool.com and is written by Nihar Patel.

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