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Emeren (SOL) Inks Deal to Monetize 29 MW of Rooftop Projects
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Emeren Group Ltd (SOL - Free Report) recently inked a deal to monetize 29 megawatts (MW) of rooftop projects in China. The monetization deal involves the sale of the portfolio of six rooftop distributed generation (DG) projects to CNNP Rich Energy Co. With this transaction, Emeren aims to boost its balance sheet strength and tap growth in China's flourishing solar market.
Emeren’s Other Projects in China
Emeren’s growth strategy to ‘Develop, Build, Own or Sell’ in China, with an increased focus on five coastal provinces, tends to strengthen its position in the region. These provinces boast the most favorable power prices, buoyed by the strong economy and regulatory environment.
As of Mar 31, 2023, Emeren had 142 MW of a mid-to-late-stage project pipeline in China, which the company expects to either sell or lock in as IPP (Independent Power Producer) over the 2023-2024 period. The company also boasts IPP assets of 174 MW and a storage pipeline of 40 MWh in the region. SOL anticipates ending 2023 with 4 gigawatts (GW) of a high-quality mid-to-late-stage project pipeline, out of which China is likely to contribute 5% of the target.
Such a strong pipeline of projects should bolster Emeren’s revenue generation prospects from the region and provide it with a competitive edge, with enhanced capability to develop a project. Developing and monetizing a project, like the latest one, is also likely to result in enough cash flows to recycle in business operations and strategic initiatives while solidifying the balance sheet.
Peer Moves
Solar companies engage in the project monetization strategy, mainly to relocate capital into other profitable ventures and the expansion of business operations. With the recycled capital, the company can explore more opportunities and boost its growth trajectory. Apart from SOL, a solar company that has adopted project monetization as a strategic tool for growth is Canadian Solar (CSIQ - Free Report) .
In June 2023,as part of its project monetization strategy, Canadian Solarsold its 100 megawatt-peak Japan flagship megaproject, Azuma Kofuji, to boost its revenues from project monetization.
The Zacks Consensus Estimate for Canadian Solar’s 2023 earnings has been revised upward by 6.5% in the past 60 days. CSIQ shares have increased 34.5% in the past year.
Price Movement
In the past year, shares of Emeren have dropped 19.2% against the industry’s rise of 21.9%.
The Zacks Consensus Estimate for Maxeon’s 2023 sales suggests a growth rate of 41.4% from the prior-year reported figure. The company delivered an earnings surprise of 190.2% in the last reported quarter.
MAXN delivered a four-quarter average earnings surprise of 36.7%. The Zacks Consensus Estimate for 2024 sales suggests a growth rate of 17.1% from the prior-year reported figure.
The Zacks Consensus Estimate for Gevo’s 2023 sales pegged at $14.8 million suggests a significant improvement from the prior-year reported figure. The Zacks Consensus Estimate for Gevo’s 2024 sales indicates an improvement of 80.3% from the prior-year estimated figure.
The Zacks Consensus Estimate for GEVO’s 2023 earnings suggests an upward revision from the prior-year reported figure. In the past month, shares of Gevo have increased 22.7%.
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Emeren (SOL) Inks Deal to Monetize 29 MW of Rooftop Projects
Emeren Group Ltd (SOL - Free Report) recently inked a deal to monetize 29 megawatts (MW) of rooftop projects in China. The monetization deal involves the sale of the portfolio of six rooftop distributed generation (DG) projects to CNNP Rich Energy Co. With this transaction, Emeren aims to boost its balance sheet strength and tap growth in China's flourishing solar market.
Emeren’s Other Projects in China
Emeren’s growth strategy to ‘Develop, Build, Own or Sell’ in China, with an increased focus on five coastal provinces, tends to strengthen its position in the region. These provinces boast the most favorable power prices, buoyed by the strong economy and regulatory environment.
As of Mar 31, 2023, Emeren had 142 MW of a mid-to-late-stage project pipeline in China, which the company expects to either sell or lock in as IPP (Independent Power Producer) over the 2023-2024 period. The company also boasts IPP assets of 174 MW and a storage pipeline of 40 MWh in the region. SOL anticipates ending 2023 with 4 gigawatts (GW) of a high-quality mid-to-late-stage project pipeline, out of which China is likely to contribute 5% of the target.
Such a strong pipeline of projects should bolster Emeren’s revenue generation prospects from the region and provide it with a competitive edge, with enhanced capability to develop a project. Developing and monetizing a project, like the latest one, is also likely to result in enough cash flows to recycle in business operations and strategic initiatives while solidifying the balance sheet.
Peer Moves
Solar companies engage in the project monetization strategy, mainly to relocate capital into other profitable ventures and the expansion of business operations. With the recycled capital, the company can explore more opportunities and boost its growth trajectory. Apart from SOL, a solar company that has adopted project monetization as a strategic tool for growth is Canadian Solar (CSIQ - Free Report) .
In June 2023,as part of its project monetization strategy, Canadian Solarsold its 100 megawatt-peak Japan flagship megaproject, Azuma Kofuji, to boost its revenues from project monetization.
The Zacks Consensus Estimate for Canadian Solar’s 2023 earnings has been revised upward by 6.5% in the past 60 days. CSIQ shares have increased 34.5% in the past year.
Price Movement
In the past year, shares of Emeren have dropped 19.2% against the industry’s rise of 21.9%.
Image Source: Zacks Investment Research
Zacks Rank
Emeren currently carries a Zacks Rank #3 (Hold). Two better-ranked stocks from the same sector that carry a Zacks Rank #2 (Buy) are Maxeon Solar Technologies (MAXN - Free Report) and Gevo (GEVO - Free Report) . You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Maxeon’s 2023 sales suggests a growth rate of 41.4% from the prior-year reported figure. The company delivered an earnings surprise of 190.2% in the last reported quarter.
MAXN delivered a four-quarter average earnings surprise of 36.7%. The Zacks Consensus Estimate for 2024 sales suggests a growth rate of 17.1% from the prior-year reported figure.
The Zacks Consensus Estimate for Gevo’s 2023 sales pegged at $14.8 million suggests a significant improvement from the prior-year reported figure. The Zacks Consensus Estimate for Gevo’s 2024 sales indicates an improvement of 80.3% from the prior-year estimated figure.
The Zacks Consensus Estimate for GEVO’s 2023 earnings suggests an upward revision from the prior-year reported figure. In the past month, shares of Gevo have increased 22.7%.