Canadian Solar Inc.
CSIQ
is set to report third-quarter 2020 results on Nov 19, before market open.
In the last reported quarter, the company delivered better-than-expected earnings. In the trailing four quarters, the company came up with an earnings surprise of 28.26%, on average.
Factors at Play
At the onset of the July-September quarter, Canadian Solar launched its super-high power Series 5 and Series 6 solar photovoltaic (PV) modules, thereby expanding the range of high-power, high-efficiency monofacial and bifacial solar modules. Considering the fact that around the first half of the third quarter,
Canadian Solar witnessed a sharp improvement in demand across most of its end markets, including the United States, Latin America, Europe, Japan, Australia and China; the aforementioned launch of modules must have boosted the company’s quarterly shipment volumes.
This in turn must have boosted Canadian Solar’s revenues in the soon-to-be-reported quarter.
Canadian Solar Inc. Price and EPS Surprise
In September, Canadian Solar completed the sale of the Suffield Solar Project to BluEarth Renewables. In fact, as stated on its second-quarter earnings call, the company must have completed a handful of project sales during the third quarter and project monetization is expected to have contributed to its revenues.
Notably, the Zacks Consensus Estimate for third-quarter revenues is pegged at $860.5 million, suggesting an improvement of 13.3% from the figure reported in the year-ago quarter.
During the third quarter, Canadian Solar started construction work on a handful of projects like the 144 MWac Pflugerville Solar Project located in Texas and the 10 MWp Groß Siemz solar power plant in Germany. This must have pushed up its operations and maintenance cost for the soon-to-reported quarter.
Such higher costs along with the company’s expectation to witness lower gross margin for its module business on account of lower average selling price (ASP) during the third quarter are likely to have impacted its bottom line.
The Zacks Consensus Estimate for loss per share stands at 4 cents, implying a huge decline from the year-ago period’s reported earnings of 66 cents.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Canadian Solar this time around. The combination of a positive
Earnings ESP
and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings surprise. But that’s not the case here, as you will see below.
Earnings ESP
: Canadian Solar has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our
Earnings ESP Filter.
Zacks Rank
: The company carries a Zacks Rank of 2. You can see
the complete list of today’s Zacks #1 Rank stocks here
.
Some Q3 Solar Releases
Enphase Energy
ENPH
reported third-quarter 2020 adjusted earnings of 30 cents per share, which surpassed the Zacks Consensus Estimate of 24 cents by 25%.
First Solar
FSLR
reported third-quarter 2020 adjusted earnings of $1.45 per share, which surpassed the Zacks Consensus Estimate of 60 cents by 141.7%.
SunPower
SPWR
incurred an adjusted loss of 4 cents per share in third-quarter 2020, narrower than the Zacks Consensus Estimate of a loss of 5 cents.
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