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Canadian Solar Inc (CSIQ)
NASDAQ:CSIQ

Canadian Solar (CSIQ) AI Stock Analysis

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Canadian Solar

(NASDAQ:CSIQ)

Rating:54Neutral
Price Target:
$12.50
▲(0.40%Upside)
Canadian Solar's overall stock score is primarily impacted by its financial challenges, including declining revenue growth and high debt levels. While technical analysis shows positive momentum, the negative valuation metrics and profitability concerns weigh heavily on the score.
Positive Factors
Energy Storage Growth
The E-STORAGE business has been executing well and exceeding expectations, which provides a partial margin offset.
Focus on US Expansion
The company's focus on expanding US solar manufacturing is in line with the US government's focus on near-shoring and helps navigate solar tariffs.
Investment and Support
The Recurrent business benefits from a $500 million equity investment by BlackRock, supporting around 3 GW of solar development.
Negative Factors
Financial Performance and Consensus
Fourth quarter net sales missed both internal estimates and consensus, coming in at the bottom of guidance.
Market and Pricing Pressure
The module oversupply continues to plague the global solar market causing sustained pricing pressure for module manufacturers.
Tariffs and Trade Policies
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)

Canadian Solar Business Overview & Revenue Model

Company DescriptionCanadian Solar Inc., together with its subsidiaries, designs, develops, manufactures, and sells solar ingots, wafers, cells, modules, and other solar power and battery storage products in Asia, the Americas, Europe, and internationally. The company operates through two segments, Canadian Solar Inc. (CSI) Solar and Global Energy. The CSI Solar segment offers standard solar modules and battery storage solutions, as well as solar system kits that are a ready-to-install packages comprising inverters, racking systems, and other accessories; and engineering, procurement, and construction (EPC) services. The Global Energy segment engages in the development, construction, maintenance, and sale of solar and battery storage projects; operation of solar power plants; and sale of electricity. This segment also provides operation and maintenance (O&M) services, including monitoring, inspections, repair, and replacement of plant equipment; and site management and administrative support services for solar projects, as well as asset management services. As of January 31, 2021, this segment had a fleet of solar power plants in operation with an aggregate capacity of approximately 445 MWp. The company serves distributors, system integrators, project developers, and installers/EPC companies. It sells its products primarily under its Canadian Solar brand name; and on an OEM basis. The company was incorporated in 2001 and is headquartered in Guelph, Canada.
How the Company Makes MoneyCanadian Solar makes money primarily through its two main business segments: Module and System Solutions (MSS) and Energy. The MSS segment generates revenue by manufacturing and selling solar modules and related products to distributors, system integrators, and project developers. This involves both direct sales and long-term supply agreements. The Energy segment involves the development, construction, operation, and sale of solar power projects. Revenue is derived from the sale of these projects, as well as from power purchase agreements (PPAs) where Canadian Solar sells electricity to utilities and other energy providers. Additionally, the company benefits from strategic partnerships and joint ventures with other energy companies and financial institutions, which help facilitate project financing and development.

Canadian Solar Key Performance Indicators (KPIs)

Any
Any
Gross Profit by Segment
Gross Profit by Segment
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:May 15, 2025
(Q1-2025)
|
% Change Since: 23.15%|
Next Earnings Date:Aug 08, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture. On one hand, Canadian Solar reported higher module shipments and launched innovative products, reflecting strong operational performance and growth potential. However, the company also faced profitability challenges, market overcapacity, and uncertainties due to US-China tariffs, leading to a net loss and reduced guidance for 2025.
Q1-2025 Updates
Positive Updates
Module Shipment Exceeds Guidance
Canadian Solar achieved module shipments of 6.9 gigawatts, slightly above guidance, indicating strong demand and operational efficiency.
New Product Launches
Canadian Solar announced several new products, including Anti-Hail technology and N-type High Power TOPCon Gen 2 modules, showcasing innovation in solar and energy storage.
Strong Energy Storage Pipeline
The company reported a record pipeline of 91 gigawatt hours in energy storage, highlighting significant growth potential in this segment.
Improved Shipping Costs
Average selling prices improved with a higher share of shipments to North America, and shipping costs declined sequentially due to softening global shipping rates.
Negative Updates
Net Loss and Profitability Challenges
Canadian Solar reported a net loss to shareholders of $34 million, or $0.69 per diluted share, due to lower contributions from storage, tariffs, and intra-company eliminations.
Structural Overcapacity and Pricing Pressure
The solar supply chain's structural overcapacity has prolonged the market downturn, putting pressure on module pricing in most global markets.
US-China Tariff Impact
Ongoing US-China tariff negotiations create uncertainty, with the US market accounting for about one-third of expected energy storage business this year.
Reduced Guidance for 2025
Canadian Solar lowered its full-year 2025 guidance for module and storage volumes due to strategic reductions in less profitable markets and US trade negotiations.
Company Guidance
In the first quarter of 2025, Canadian Solar reported a solid performance with module shipments reaching 6.9 gigawatts, exceeding guidance slightly, and revenue totaling $1.2 billion, at the high end of their forecast. The gross margin was 11.7%, modestly surpassing expectations. Despite these achievements, the company faced challenges, including lower contributions from storage, duties, tariffs, and ongoing transformation, resulting in a net loss to shareholders of $34 million or $0.69 per diluted share. Looking forward, they anticipate module shipments for the second quarter to range between 7.5 and 8 gigawatts and energy storage solutions of 2.4 to 2.6 gigawatt-hours, with a projected revenue of $1.9 to $2.1 billion, and gross margin expected between 23% and 25%. Full-year 2025 guidance was updated, with module volume now expected between 25 and 30 gigawatts and energy storage shipments between 7 and 9 gigawatt-hours, leading to an anticipated full-year revenue of $6.1 to $7.1 billion.

Canadian Solar Financial Statement Overview

Summary
Canadian Solar's financials show significant challenges, including a negative cash flow growth rate and reduced profitability. High debt levels and declining revenue growth reflect operational difficulties and financial risk.
Income Statement
45
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
55
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
40
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.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue5.99B7.61B7.47B5.28B3.48B
Gross Profit999.32M1.28B1.26B909.31M689.91M
EBITDA556.61M829.66M675.15M494.31M423.51M
Net Income36.05M274.19M239.97M95.25M146.70M
Balance Sheet
Total Assets13.51B11.90B9.04B7.39B6.54B
Cash, Cash Equivalents and Short-Term Investments2.25B1.96B981.43M869.83M1.18B
Total Debt5.91B4.48B4.01B3.26B2.81B
Total Liabilities9.36B8.19B6.73B5.26B4.64B
Stockholders Equity2.82B2.56B1.94B1.80B1.57B
Cash Flow
Free Cash Flow-2.75B-840.85M288.63M-837.75M-455.48M
Operating Cash Flow-885.32M684.62M916.63M-408.25M-120.54M
Investing Cash Flow-1.96B-1.67B-630.49M-429.57M-319.66M
Financing Cash Flow2.32B2.05B428.64M614.07M823.50M

Canadian Solar Technical Analysis

Technical Analysis Sentiment
Positive
Last Price12.45
Price Trends
50DMA
10.31
Positive
100DMA
9.88
Positive
200DMA
11.28
Positive
Market Momentum
MACD
0.33
Negative
RSI
67.46
Neutral
STOCH
80.59
Negative
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 12.45 is above the 20-day moving average (MA) of 10.97, above the 50-day MA of 10.31, and above the 200-day MA of 11.28, indicating a bullish trend. The MACD of 0.33 indicates Negative momentum. The RSI at 67.46 is Neutral, neither overbought nor oversold. The STOCH value of 80.59 is Negative, 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 (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
71
Outperform
$5.37B38.1217.13%-22.15%-45.22%
70
Neutral
$880.18M48.413.43%-18.10%-36.91%
63
Neutral
$33.24B5.92-11.55%1.90%5.54%-20.14%
JKJKS
60
Neutral
$1.08B118.10-9.49%6.86%-30.26%-156.69%
56
Neutral
$1.01B-49.11%-21.31%-593.57%
54
Neutral
$749.42M20.05-0.39%-19.06%-104.91%
52
Neutral
$1.29B-121.50%-57.89%-559.87%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CSIQ
Canadian Solar
12.45
-2.90
-18.89%
ENPH
Enphase Energy
40.97
-56.17
-57.82%
JKS
JinkoSolar
23.50
4.55
24.01%
SEDG
SolarEdge Technologies
23.60
-1.45
-5.79%
ARRY
Array Technologies
6.96
-2.66
-27.65%
SHLS
Shoals Technologies Group
5.47
-0.48
-8.07%
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: Jul 03, 2025