This isn’t the 5N Plus you once knew, analyst says

Amr Ezzat of Ventum Capital Markets sees silver linings for 5N Plus (5N PLUS Stock Quote, Chart, News, Analysts, Financials TSX:VNP) despite First Solar’s recent earnings stumble, reaffirming his Buy rating and C$10.00 price target on the high-purity semiconductor materials producer.

The catalyst for Ezzat’s April 30 corporate update was First Solar’s disappointing Q1 2025 results and its lowered full-year guidance, triggered by operational disruptions and tariff uncertainty in Asia. But Ezzat sees little reason for concern when it comes to 5N Plus. While First Solar’s facilities in Malaysia, Vietnam and India have hit turbulence, 5N Plus continues to supply cadmium telluride (CdTe) semiconductor materials to First Solar’s U.S. manufacturing base, a part of the business that remains unaffected and is actually ramping up.

“While international volumes may represent longer-term optionality, the company’s relationship with First Solar has been primarily concentrated in the US over the past several years, and this is where the most meaningful growth is occurring,” Ezzat said. “If anything, the increased complexity and economic headwinds tied to international manufacturing may reinforce First Solar’s focus on scaling its domestic footprint, a scenario that further strengthens 5N Plus’s strategic positioning.

“We thus view the results as modestly positive for 5N Plus.”

He said that while the guidance revision reflects softness in First Solar’s international sales, “we see no direct impact on 5N Plus’s contract, volumes or margin profile.”

Ezzat forecasts that 5N Plus will generate $58.4-million in adjusted EBITDA on $330.5-million in revenue in fiscal 2025. He expects those numbers to rise to $68.4-million in adjusted EBITDA on $370.7-million in revenue in fiscal 2026.

Ezzat said 5N Plus presents a compelling investment case as a transformed, high-calibre materials innovator at the nexus of renewable energy, space-based technologies and semiconductors.

“The company’s strategic focus on advanced materials and decades of innovation-driven expertise have established formidable barriers to entry, positioning it as a linchpin in essential supply chains across high-growth markets. As a key supplier to First Solar, the company is positioned to ride the accelerating demand for thin-film photovoltaics, while its AZUR Space division cements its foothold in the rapidly expanding space solar power market. At the same time, its geopolitical edge, being the only viable non-China-based provider of ultra-high-purity semiconductor compounds, makes it indispensable as Western nations race to localize supply chains.”

Ezzat added that 5N Plus is no longer the commodity metals company it once was.

“This is not the same company investors once knew — 5N Plus has decisively shifted toward high-margin, value-added markets,” he wrote, citing its positioning at the crossroads of clean energy, space technology, and semiconductors.

“With long-term contracts reinforcing deep-rooted customer relationships and a vertically integrated supply chain ensuring operational resilience, 5N Plus stands out as a compelling yet underappreciated growth story.”

-30-