First Solar (FSLR) Gets Hate from Jim Chanos

First Solar (NASDAQ:FSLR) has been getting clobbered lately, and the latest joining the dump-FSLR club is Jim Chanos.

He said this on CNBC today:

"There’s a real easy part of the story: Insiders are selling lots and lots of stock over the past year, and insiders are leaving the company. That’s never a good sign. Whether you should be short, we have some issues with some of their accounting, we have some issue with some of their subsidized markets. And quite frankly, solar, still, is at a point where it does not compete with natural gas. we cannot rely on wind and solar for base load. We’re still looking for the magic bullet for solar and wind. I think the stock certainly could earn a lot less than the $9 run-rate the bulls are looking at."

Numerous analysts are mixed on their outlook for First Solar and the solar industry in general, which continues to weaken.

First Solar was trading at $127.34, falling $7.32, or 5.44 percent, as of 1:58 PM EDT.

First Solar (NASDAQ:FSLR) Not Sunny Says Chanos

Spin it as they may, media can't hide the fact that solar is a disaster, as evidenced by the shrinking and unsustainable subsidies offered by governments in Europe, and as Jim Chanos notes with First Solar Inc. (NASDAQ:FSLR), insiders abandoning the stock right and left.

"Seeing the pattern that shorts sellers love," Chanos said in an interview. "Enormous insider selling, chairman has gotten rid of most of his stock in the last years and a half and departures."

The fantasy of low-demand and high-cost, so-called "green energy" like solar is proving to be a disaster, and even with the recent news that General Electric (NYSE:GE) is investing hundreds of millions into the sector only proves the lack of wisdom by those in decision-making positions, not the viability of the industry.

As Chanos rightly notes, reliance on traditional sources of energy isn't going away, and in fact, sources like coal are growing in demand globally, not declining.

Solar needs to be stripped of every government subsidy and compete against existing energy sources to see if there is real demand for it.

First Solar was trading at $140.36, falling $4.37, or 3.02 percent, as of 2:17 PM EDT.

Chanos Long on (FMCN) (C) (NYX) (NDAQ) (RAX)

Jim Chanos has built his reputation on his short sales, but that has changed some, according to the latest filing of Kynikos Associates LP, which via its 13F form shows the company has taken long positions in a number of holdings, including Citigroup (NYSE:C) NYSE Euronext (NYSE:NYX), NASDAQ OMX (NASDAQ:NDAQ), Focus Media Holding Ltd (NASDAQ:FMCN) and Rackspace Hosting (NYSE:RAX).

This may be the first time Chanos's company has entered into long positions, suggesting a major shift in strategy and thinking.

It will bear watching over the months ahead to see if this is a long-term shift for the shorting legend.

There are numerous theories as to why Chanos has started going long, one of which is new investors may be pressing him to become more investment-neutral than in the past.

It'll be interesting to see if he offers up an explanation.