Canadian Solar (CSIQ) AI Stock Analysis

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Canadian Solar

(NASDAQ:CSIQ)

Rating:49Neutral

Price Target:

$11.00

▼(-1.52% Downside)

Canadian Solar's overall stock score is primarily impacted by its financial performance, which faces significant challenges with declining revenue, high debt, and negative cash flow trends. Technical analysis provides mixed signals, and valuation metrics are unfavorable with a negative P/E ratio. The earnings call offers some positive insights, but ongoing operational challenges and rising costs weigh on the outlook.

Positive Factors

Business Execution

The E-STORAGE business has been executing well and exceeding expectations, which provides a partial margin offset.

Project Stability

Recurrent has safe-harbored a significant number of projects and did not see cancellations.

Negative Factors

Module Market Pressure

The module oversupply continues to plague the global solar market causing sustained pricing pressure for module manufacturers.

Revenue Performance

CSIQ missed revenue and provided below-consensus revenue guidance as certain project sales shifted into the future.

Tariff Impact

The recent 145% China tariffs result in uncertainty and risk around the company's storage economics.

Canadian Solar (CSIQ) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$650.30M

Dividend YieldN/A

Average Volume (3M)1.29M

Price to Earnings (P/E)20.1

Beta (1Y)1.78

Revenue Growth-9.11%

EPS Growth-118.62%

CountryUS

Employees17,113

SectorTechnology

Sector Strength84

IndustrySolar

Share Statistics

EPS (TTM)0.11

Shares Outstanding66,972,244

10 Day Avg. Volume2,354,423

30 Day Avg. Volume1,286,960

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market Cap10.68

Enterprise Value/Revenue1.16

Enterprise Value/Gross Profit6.95

Enterprise Value/Ebitda24.18

Forecast

1Y Price Target

$12.50

Price Target Upside11.91% Upside

Rating ConsensusHold

Number of Analyst Covering6

Canadian Solar Business Overview & Revenue Model

Company DescriptionCanadian Solar Inc. is a leading global solar energy solutions provider, specializing in the manufacturing of solar photovoltaic (PV) modules and providing solar energy services. Founded in 2001 and headquartered in Guelph, Ontario, the company operates in the renewable energy sector, focusing on solar power generation. Canadian Solar's core products include high-efficiency solar panels and energy storage systems, along with offering project development, financing, and operation and maintenance services for solar power projects worldwide.

How the Company Makes MoneyCanadian Solar generates revenue primarily through the sale of solar photovoltaic modules, which are sold to distributors, installers, and project developers around the globe. Additionally, the company earns income from its project development segment by constructing and selling solar power plants, as well as through long-term power purchase agreements (PPAs) that provide stable cash flow from operating solar facilities. Key revenue streams include module sales, project sales, and operations and maintenance services. Canadian Solar has established significant partnerships with various stakeholders in the energy sector, including utility companies and government agencies, to enhance its market presence and secure contracts that contribute to its earnings. The company is also involved in the energy storage market, which is an emerging revenue source as demand for integrated solar and storage solutions increases.

Canadian Solar Key Performance Indicators (KPIs)

Any

Gross Profit by Segment

Gross Profit by Segment
Reveals the profitability of each business segment, indicating where the company is most efficient and where there may be cost management challenges.

Chart InsightsCanadian Solar's gross profit from CSI Solar shows a volatile trend, with a significant drop in early 2025. This aligns with the earnings call highlighting profitability challenges, market overcapacity, and tariff impacts. Despite strong module shipments and innovative product launches, these factors led to a net loss and reduced guidance for 2025. Recurrent Energy's contribution remains inconsistent, further stressing the need for strategic adjustments. The company's focus on energy storage growth and improved shipping costs could mitigate some risks, but market uncertainties remain a concern.

Data provided by:

Main Street Data

Canadian Solar Earnings Call Summary

Earnings Call Date:Aug 21, 2025

(Q2-2025)

% Change Since: |

Next Earnings Date:Nov 19, 2025

Earnings Call Sentiment Neutral

While Canadian Solar reported strong module shipments and exceeded gross margin guidance, the company faced challenges with storage shipment delays, impacted revenue from delayed project sales, and rising supply chain costs. Additionally, profitability was affected by nonrecurring expenses. The commitment to sustainability and strong performance in North America are positive aspects, but the significant challenges balance the overall sentiment.

Q2-2025 Updates

Positive Updates

Module Shipments Near High End of Guidance

In Q2 2025, Canadian Solar delivered 7.9 gigawatts of modules, near the high end of their guidance.

Strong Gross Margin Performance

Gross margin exceeded guidance at 29.8%, driven by a higher mix of North America module shipments and robust storage performance.

Sustainability Achievements

In 2024, Canadian Solar reduced greenhouse gas emissions, energy, water, and waste intensities significantly compared to 2017 levels, and increased the percentage of recycled and reused waste to 94%.

Negative Updates

Storage Shipments Below Guidance

Storage shipments reached 2.2 gigawatt hours, below guidance due to tariff impacts shifting deliveries into the second half of the year.

Project Sales Delays Impact Revenue

Revenue totaled $1.7 billion for Q2, impacted by delayed project sales and resulting in lower-than-expected outcomes.

Profitability Weighed Down by Nonrecurring Expenses

Profitability was impacted by certain nonrecurring operating expenses, including the impairment of legacy manufacturing assets, resulting in a net income attributable to shareholders of $7 million.

Rising Supply Chain Costs

Rising supply chain costs driven by the anti-involution campaign in China, combined with tariffs and duties, are expected to raise unit costs in the second half.

Company Guidance

During the Canadian Solar Second Quarter 2025 Earnings Conference Call, the company provided several key metrics and insights into their performance and future expectations. Canadian Solar delivered 7.9 gigawatts of modules, which was near the high end of their guidance, while storage shipments reached 2.2 gigawatt hours, falling below guidance due to tariff impacts. The company's revenue totaled $1.7 billion, which was affected by certain project sale delays. Despite this, they exceeded gross margin guidance, achieving 29.8%, driven by a higher mix of North American module shipments and robust storage performance. However, profitability was impacted by nonrecurring operating expenses, leading to a net income attributable to shareholders of $7 million or a net loss of 8¢ per diluted share. For the third quarter of 2025, Canadian Solar forecasts module volumes between 5 to 5.3 gigawatts and energy storage shipments between 2.1 to 2.3 gigawatt hours, with expected revenue ranging from $1.3 to $1.5 billion and gross margins between 14 to 16%. For the full year, they have narrowed their module volume guidance to 25 to 27 gigawatts and revised their revenue guidance to between $5.65 and $6.3 billion.

Canadian Solar Financial Statement Overview

Summary

Canadian Solar faces significant financial challenges, with declining revenue growth, high debt levels, and negative cash flow trends. The income statement shows reduced profitability, and the balance sheet indicates high financial leverage. Cash flow issues further highlight operational inefficiencies and liquidity concerns.

Income Statement

Neutral

Canadian Solar's income statement reveals challenges with profitability and growth. The gross profit margin for 2024 is approximately 16.67%, indicating a decline from previous years, reflecting increased cost pressures. The company reported a negative EBIT margin of -2.08%, showing operating challenges. The revenue growth rate from 2023 to 2024 was negative at -21.28%, indicating a significant decline in sales. Net profit margin shrank to 0.60%, highlighting reduced profitability despite positive net income.

Balance Sheet

Neutral

The balance sheet of Canadian Solar showcases a mixed financial position. The debt-to-equity ratio stands at 2.10, indicating high financial leverage and potential risk from over-reliance on debt financing. However, the equity ratio is 20.84%, reflecting moderate equity support. Return on equity (ROE) for 2024 is a modest 1.28%, suggesting limited returns for shareholders. Overall, the company maintains a balance between assets and liabilities, but high debt levels remain a concern.

Cash Flow

Negative

Canadian Solar's cash flow statement highlights significant cash flow challenges. The company experienced a negative free cash flow growth rate of -227.06% from 2023 to 2024, indicating declining free cash availability. The operating cash flow to net income ratio is negative, suggesting operational inefficiencies, while the free cash flow to net income ratio is also unfavorable. This highlights the company's difficulty in generating cash from operations, which may affect liquidity.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.99B	7.61B	7.47B	5.28B	3.48B
Gross Profit	999.32M	1.28B	1.26B	909.31M	689.91M
EBITDA	556.61M	829.66M	675.15M	494.31M	423.51M
Net Income	36.05M	274.19M	239.97M	95.25M	146.70M
Balance Sheet
Total Assets	13.51B	11.90B	9.04B	7.39B	6.54B
Cash, Cash Equivalents and Short-Term Investments	2.25B	1.96B	981.43M	869.83M	1.18B
Total Debt	5.91B	4.48B	4.01B	3.26B	2.81B
Total Liabilities	9.36B	8.19B	6.73B	5.26B	4.64B
Stockholders Equity	2.82B	2.56B	1.94B	1.80B	1.57B
Cash Flow
Free Cash Flow	-2.75B	-840.85M	288.63M	-837.75M	-455.48M
Operating Cash Flow	-885.32M	684.62M	916.63M	-408.25M	-120.54M
Investing Cash Flow	-1.96B	-1.67B	-630.49M	-429.57M	-319.66M
Financing Cash Flow	2.32B	2.05B	428.64M	614.07M	823.50M

Canadian Solar Technical Analysis

Technical Analysis Sentiment

Positive

Last Price11.17

Price Trends

50DMA

11.89

Negative

100DMA

10.89

Positive

200DMA

10.80

Positive

Market Momentum

MACD

-0.49

Positive

RSI

50.31

Neutral

STOCH

35.42

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CSIQ, the sentiment is Positive. The current price of 11.17 is above the 20-day moving average (MA) of 11.16, below the 50-day MA of 11.89, and above the 200-day MA of 10.80, indicating a neutral trend. The MACD of -0.49 indicates Positive momentum. The RSI at 50.31 is Neutral, neither overbought nor oversold. The STOCH value of 35.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CSIQ.

Canadian Solar Risk Analysis

Canadian Solar disclosed 63 risk factors in its most recent earnings report. Canadian Solar reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Canadian Solar Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ENPH	75 Outperform	$4.78B	28.77	19.79%	―	4.39%	37.70%
SHLS	67 Neutral	$1.20B	56.65	3.77%	―	-11.95%	-7.87%
ARRY	64 Neutral	$1.39B	―	-44.13%	―	6.36%	-1683.09%
Sector *	61 Neutral	$35.52B	8.84	-11.06%	1.87%	8.55%	-8.14%
JKS	53 Neutral	$1.22B	118.10	-9.49%	10.83%	-30.26%	-156.69%
SEDG	51 Neutral	$2.03B	―	-131.02%	―	-36.07%	-233.14%
CSIQ	49 Neutral	$650.30M	20.05	-0.25%	―	-9.11%	-118.62%

* Technology Sector Average

Performance Comparison

CSIQ

Canadian Solar

11.17

-0.73

-6.13%

ENPH

Enphase Energy

39.65

-63.39

-61.52%

JKS

JinkoSolar

25.48

8.58

50.77%

SEDG

SolarEdge Technologies

34.42

16.48

91.86%

ARRY

Array Technologies

8.97

2.96

49.25%

SHLS

Shoals Technologies Group

7.16

1.34

23.02%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Sep 06, 2025