Jefferies cuts Canadian Solar target to $13.70, keeps Buy rating

Published 16/05/2025, 10:08
Jefferies cuts Canadian Solar target to $13.70, keeps Buy rating

On Friday, Jefferies analyst Johnson Wan revised the price target for Canadian Solar Inc. (NASDAQ:CSIQ) to $13.70, a slight decrease from the previous $14.15, while maintaining a Buy rating on the stock. Currently trading at $10.69, InvestingPro analysis suggests the stock is slightly undervalued. The adjustment follows Canadian Solar’s first-quarter financial results for 2025, which showed revenues and net profit figures of $1,197 million and a loss of $34 million, respectively, continuing the company’s unprofitable streak over the last twelve months. The company’s gross profit margin (GPM) stood at 11.7% for the quarter, a decline from 14.3% in the fourth quarter of 2024 and 19% in the first quarter of the previous year.

Canadian Solar exceeded its guidance for module shipments, reaching 6.9 gigawatts (GW), while energy storage system (ESS) shipments met expectations at 0.8 gigawatt-hours (GWh). Looking ahead to the second quarter of 2025, the company anticipates module shipments to increase to between 7.5 and 8GW, and ESS shipments to range from 2.4 to 2.6GWh. Additionally, the gross profit margin is projected to rise to between 23% and 25%, bolstered by robust ESS shipments and a roughly 6% positive impact from a one-off item.

Despite these optimistic projections for the second quarter, Canadian Solar has reduced its full-year 2025 guidance for module and ESS shipments to 25-30GW and 7-9GWh, respectively, citing policy uncertainty. During the earnings call, the focus remained on the company’s future earnings outlook (FEOC), highlighting the strategic considerations for the upcoming periods.

In other recent news, Canadian Solar Inc. reported first-quarter revenue of $1.2 billion, aligning with analyst expectations, though the adjusted earnings per share showed a wider loss than anticipated. The company, however, issued a positive revenue forecast for the second quarter, projecting between $1.9 billion and $2.1 billion, surpassing the $1.76 billion consensus estimate. For the full year 2025, Canadian Solar expects revenue to range from $6.1 billion to $7.1 billion. In addition to financial results, Canadian Solar filed a Form 6-K with the U.S. Securities and Exchange Commission, ensuring compliance with reporting requirements for foreign private issuers.

Analyst perspectives varied, with JPMorgan maintaining an Underweight rating and a price target of $7.00, noting strong first-quarter performance but highlighting potential risks from legislative developments. Meanwhile, Oppenheimer maintained an Outperform rating with a $23.00 price target, emphasizing Canadian Solar’s strategic shift towards more profitable markets and its strong position in development assets. The company’s gross margin of 11.7% exceeded its guidance range, although profitability was affected by lower storage sales and market challenges. Canadian Solar’s shipment of 6.9 gigawatts of solar modules marked a 9.4% increase year-over-year, and its battery energy storage project pipeline reached a record 91 gigawatt hours.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.