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Canadian Solar (CSIQ) Q3 Earnings & Sales Lag, Down Y/Y

Zacks Equity Research

Canadian Solar Inc. CSIQ reported adjusted third-quarter 2019 earnings of 66 cents per share, which missed the Zacks Consensus Estimate of 88 cents by 25%. The figure also declined 31.3% from the year-ago level.

GAAP earnings came in at 96 cents per share in the quarter under review compared with $1.04 in third-quarter 2018.

Total Revenues

This solar cell manufacturer’s total revenues of $759.9 million lagged the Zacks Consensus Estimate of $798 million by 4.8%. The top line also declined 1.1% from $768 million reported in third-quarter 2018.

The year-over-year decline was due lower revenues from the sale of solar power plants.

Canadian Solar Inc. Price, Consensus and EPS Surprise

Canadian Solar Inc. Price, Consensus and EPS Surprise
Canadian Solar Inc. Price, Consensus and EPS Surprise

Canadian Solar Inc. price-consensus-eps-surprise-chart | Canadian Solar Inc. Quote

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Operational Update

Solar module shipments in the quarter totaled 2,387 megawatts (MW), which exceeded management’s guided range of 2.2-2.3 gigawatt (GW). Solar module shipments recognized in third-quarter revenues totaled 2,156 MW, improving 41.7% from 1,521 MW in the prior-year period.

Gross margin was 23% in the quarter (excluding AD and CVD benefits) compared with 25% in third-quarter 2018.

Total operating expenses were $118.8 million, up 13.7% year over year. The increase in operating costs in the reported quarter was due to higher selling expenses, general and administrative expenses, and research and development expenses.

Interest expenses were $19.2 million, down 7.2% from $20.7 million recorded in the year-ago period.

Financial Update

As of Sep 30, 2019, cash and cash equivalents totaled $526.2 million, up from $444.3 million on Dec 31, 2018.

Long-term borrowings as of Sep 30, 2019 were $525.9 million, up from $393.6 million on Dec 31, 2018.

Guidance

For fourth-quarter 2019, Canadian Solar expects shipments in the range of 2.3-2.4 GW. This guidance includes approximately 190 MW of shipments to its utility-scale solar power projects that may not be recognized as revenues in the fourth quarter. Total revenues are projected within $850-$880 million, while gross margin is expected in the band of 19-21%.

For 2019, Canadian Solar reiterated its guidance for total module shipments in the range of 8.4-8.5 GW. Total revenues for the year are expected in the range of $3.13-$3.16 billion.

Zacks Rank

Canadian Solar currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Recent Releases

SunPower Corp. SPWR reported adjusted earnings of 22 cents per share in third-quarter 2019 against the Zacks Consensus Estimate of a loss of a penny.

Enphase Energy, Inc. ENPH reported third-quarter 2019 adjusted earnings of 30 cents per share, which surpassed the Zacks Consensus Estimate of 25 cents by 20%.

SolarEdge Technologies, Inc. SEDG reported third-quarter 2019 adjusted earnings of $1.21 per share, which surpassed the Zacks Consensus Estimate of 99 cents by 22.2%.

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Canadian Solar Inc. (CSIQ) : Free Stock Analysis Report
 
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