In a bull market or at least a day when the market has upside potential, an upgrade to an issue may instigate an oversized move higher.

In a bear market, even an upgrade to an issue in a strong sector may not have the same effect. That certainly applies to First Solar Inc. (NASDAQ:FSLR), which is Thursday's PreMarket Prep Stock of the Day.

Rangebound: Despite the wild gyrations in the S&P 500 index over the last few weeks, First Solar has been in a $13 trading range from $127.07 to $140.64.

The top of the range marks over an 11-year high in the issue, when it peaked in June 2011 at $142.22. Even that price is 50% less than half of its all-time high, which was made in May 2008 at $317.

The bottom of the trading range was made last Friday at $127.07 and was buffeted by a low the following day at $127.60.

The highest close for the recent rally was made on Sept. 19 at $137.04.

First Solar Upgrade: Before the opening, Evercore ISI Group analyst Sean Morgan upgraded First Solar from In-Line to Outperform and raised the price target from $88 to $150.

That comes in just above Morgan Stanley's price target for the issue of $136.

PreMarket Prep's Take: While the issue was being discussed on the show Thursday, it was trading nearly a buck higher in the lower $137 handle.

Co-host Dennis Dick was not in the mood to fade this upgrade.

“The relative strength in solar stocks has been incredible and I am not tempted to short it, even at a multiyear high,” he said. 

The author of this article alerted investors that the recent closing high for the move was made on Sept. 19 at $137.04.

In addition, the importance of staying above the opening print, wherever it may be, was emphasized, as traders could instigate some downside price action if it were breached.

FSLR Price Action: After a modestly higher open, the issue surpassed the recent closing high for the move, rallying to $138.19 and sharply reversing course.

Not only did the issue slice though the opening price, it went well beyond that. First Solar ultimately lost 3.86% Thursday, closing at $130.93.

The discussion on the issue from Thursday’s show can be found here:

Photo via Shutterstock.