In a significant development impacting the solar industry, the U.S. has imposed substantial tariffs, reaching up to 3,521%, on solar imports from four Southeast Asian countries, citing unfair trade practices. These duties result from a trade investigation that identified benefits from government subsidies and products being sold below production costs in the U.S. market.
Citi highlighted that the final duty rates for imports from Cambodia, Malaysia, Thailand, and Vietnam stand at 652%, 34%, 375%, and 396%, respectively. The financial institution suggests these tariffs could negatively affect the entire solar sector, with Canadian Solar (CSIQ, Financial) potentially facing adverse impacts. However, First Solar emerges as a notable exception, benefiting from its local U.S. operations and unique technology that mitigates exposure to these tariffs.
As the solar industry braces for the repercussions of these duties, the situation presents both challenges and opportunities, with First Solar being best positioned to capitalize on the evolving regulatory landscape.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 10 analysts, the average target price for Canadian Solar Inc (CSIQ, Financial) is $14.88 with a high estimate of $30.38 and a low estimate of $7.28. The average target implies an upside of 52.31% from the current price of $9.77. More detailed estimate data can be found on the Canadian Solar Inc (CSIQ) Forecast page.
Based on the consensus recommendation from 11 brokerage firms, Canadian Solar Inc's (CSIQ, Financial) average brokerage recommendation is currently 2.7, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Canadian Solar Inc (CSIQ, Financial) in one year is $28.82, suggesting a upside of 194.98% from the current price of $9.77. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Canadian Solar Inc (CSIQ) Summary page.
CSIQ Key Business Developments
Release Date: March 25, 2025
- Revenue: $6 billion for the full year 2024.
- Net Income: $34 million or $0.48 per diluted share for Canadian Solar shareholders.
- Solar Module Shipments: 8.2 gigawatts in Q4, totaling 31.1 gigawatts for 2024.
- Energy Storage Shipments: 2.2 gigawatt hours in Q4, totaling 6.6 gigawatt hours for 2024.
- Gross Margin: 18.4% for the full year 2024.
- Operating Loss: $40 million for Recurrent Energy in Q4.
- Project Sales: 540 megawatts of PV projects sold in Q4, totaling 1.2 gigawatts for 2024.
- Cash Flow: Net increase in cash of $682 million for the full year 2024.
- Capital Expenditures: $1.1 billion for 2024, with a forecast of $1.2 billion for 2025.
- Q1 2025 Revenue Guidance: $1 billion to $1.2 billion.
- Q1 2025 Gross Margin Guidance: 9% to 11%.
- Full Year 2025 Revenue Guidance: $7.3 billion to $8.3 billion.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Canadian Solar Inc (CSIQ, Financial) shipped 8.2 gigawatts of solar modules in Q4, contributing to a total of 31.1 gigawatts for the year.
- The company achieved record energy storage volume, with a 500% year-over-year increase in shipments, reaching 6.6 gigawatt hours in 2024.
- Canadian Solar Inc (CSIQ) is making significant progress on its US manufacturing facilities, which will enhance its domestic production capabilities.
- The company is well-positioned to capitalize on the growing demand for energy storage, with a strong pipeline of 79 gigawatt hours.
- Canadian Solar Inc (CSIQ) maintained relatively strong profitability in a challenging market by adhering to a disciplined order-taking strategy and focusing on high-margin channels.
Negative Points
- The company faced a challenging operating environment in 2024, with net income for shareholders at only $34 million.
- Gross margin was negatively impacted by inventory write-downs, freight-related duties, tariffs, and project asset impairments.
- The solar industry experienced intensified competition and structural overcapacity, leading to a prolonged market downturn.
- Geopolitical uncertainties and trade-related challenges in key markets like the US are creating operational and financial headwinds.
- General and administrative expenses increased significantly due to impairments to certain manufacturing assets and solar power systems.
