What happened Shares of thin-film solar specialist First Solar (NASDAQ: FSLR) jumped more than 11% in early trading and are holding onto an 8.7% gain in 2:15 p.m. EST trading. First solar isn't alone -- lots of other solar stocks are having a good day today. But First Solar's gain is more curious than most. Because First Solar just got downgraded. Image source: Getty Images. So what Well, maybe not "just," exactly. Technically, Morgan Stanley's downgrade of First Solar stock came out late in the trading session yesterday. But even so, some of the analyst's notes bear repeating, because they suggest reasons why First Solar's strong gains today could prove short-lived. Some investors seem to think that as Vice President Biden's chances of winning the White House increase, the prospects for solar stocks, too, will increase (because Biden has promised to spend $1.7 trillion on renewable energy). But as Morgan Stanley explained, it really doesn't matter if Biden eventually wins or Trumps wins. Whoever wins, warns the analyst, First Solar stock is "overvalued in all election outcomes." Now what And I can't say as I disagree. At a current valuation of $8 billion -- $9.2 billion market capitalization minus cash and plus debt -- First Solar stock costs nearly 36 times trailing earnings and more than 54 times trailing free cash flow. According to S&P Global Market Intelligence data, most analysts estimate that First Solar will grow its earnings at less than 14% annually over the next five years. But even if you think that's conservative and assume that, say, four years of a Biden Administration's green-friendly policies will help First Solar grow twice as fast as most analysts think likely, that would only raise the growth rate to 28% per year. Relative to First Solar's 36 price-to-earnings (P/E) ratio, that still leaves the stock trading above a 1x ratio, and relative to the stock's enterprise value to free cash flow (EV/FCF), the ratio grows to nearly 2x. In the richly valued solar sector, such high valuations may be the norm these days -- but it still doesn't make them cheap. 10 stocks we like better than First SolarWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and First Solar wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of October 20, 2020 Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends First Solar. The Motley Fool has a disclosure policy.Source