We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Canadian Solar's (CSIQ) Arm Unveils Capacity Expansion Plans
Read MoreHide Full Article
Canadian Solar Inc.’s (CSIQ - Free Report) arm, CSI Solar, recently introduced its capacity expansion plans to fortify its position in an increased solar demand scenario and ease supply-chain woes.
Per the new expansion strategy, CSI Solar aims to add 30 gigawatts (GW) of ingot, 15 GW of wafer, 10 GW of cell and 25 GW of module capacity by the end of the first quarter of 2024. This will result in a total capacity of 50.4 GW of ingot, 50 GW of wafer, 60 GW of cell and 75 GW of module capacity for the company.
Such an expansion strategy and the vertical integration of manufacturing capacity are likely to assist CSIQ in efficient cost management and sourcing of raw materials.
Benefits of the Expansion
Supply-chain issues have and continue to impact companies in the solar space. The recent capacity expansion plans of Canadian Solar come with the rationale to ease such supply-chain disruptions and improve delivery times.
Also, such a vertically integrated manufacturing process will provide Canadian Solar with a competitive edge, enabling the company to meet the growing demand for solar products proactively with its unique products and services. It may also stabilize the cost structure for CSIQ, taking it to relatively the bottom of the cost curve.
Expanding its vertically integrated manufacturing capacity is also likely to result in better control over the production capacity and adjust the production level per demand.
Canadian Solar already boasts a large customer pipeline across key markets in the United States, China, Japan, the U.K. and Canada, and emerging markets in Brazil, India, Mexico, Italy, Germany, South Africa and the Middle East. Such capacity expansion will probably consolidate CSIQ’s positioning in the global solar market, thereby strengthening its customer base significantly and reaping a handful of returns for the company.
Solar Companies’ Focus on Capacity Expansion
Nations are gradually moving toward renewable sources of energy to curtail the carbon footprint. This has resulted in substantial demand for solar-related products, with both small-scale solar projects and large-scale solar projects like utility-scale solar projects being the major drivers.
In such a scenario, other than Canadian Solar, solar companies that have opted to expand manufacturing capacity to meet the growing global demand are as follows:
Enphase Energy (ENPH - Free Report) added an automated line at Flex's factory in Romania. This line has a quarterly capacity of approximately 750,000 microinverters. It will enable a global capacity of nearly six million microinverters per quarter, with plans to further escalate capacity.
Enphase boasts a long-term (three-five) earnings growth rate of 45.4%. ENPH shares have increased 2.9% in the past year.
First Solar (FSLR - Free Report) is investing heftily in the production ramp-up of solar modules to expand its manufacturing capacity. It announced plans to expand its manufacturing capacity by 6.6 GW by constructing its third manufacturing facility in the United States and first manufacturing facility in India.
The new facilities are expected to commence operations in the first half of 2023 and the second half of 2023, respectively. The company is now projected to build its fourth manufacturing facility in the United States, which is expected to commence operations in 2025.
The Zacks Consensus Estimate for First Solar’s 2023 sales suggests a growth rate of 34.4% from the prior-year reported figure. Shares of FSLR have surged 166.2% in the past year.
In May 2022, SolarEdge (SEDG - Free Report) announced the opening of Sella 2, a two-gigawatt-hour battery cell manufacturing facility. Sella 2 enables the company to have its supply of lithium-ion batteries and the infrastructure to develop new battery cell chemistries and technologies.
SolarEdge’s long-term earnings growth rate is pegged at 31%. SEDG shares have rallied 47.3% in the past six months.
Price Movement
In a year, shares of Canadian Solar have soared 13% compared with the industry’s growth of 17.8%.
Image: Bigstock
Canadian Solar's (CSIQ) Arm Unveils Capacity Expansion Plans
Canadian Solar Inc.’s (CSIQ - Free Report) arm, CSI Solar, recently introduced its capacity expansion plans to fortify its position in an increased solar demand scenario and ease supply-chain woes.
Per the new expansion strategy, CSI Solar aims to add 30 gigawatts (GW) of ingot, 15 GW of wafer, 10 GW of cell and 25 GW of module capacity by the end of the first quarter of 2024. This will result in a total capacity of 50.4 GW of ingot, 50 GW of wafer, 60 GW of cell and 75 GW of module capacity for the company.
Such an expansion strategy and the vertical integration of manufacturing capacity are likely to assist CSIQ in efficient cost management and sourcing of raw materials.
Benefits of the Expansion
Supply-chain issues have and continue to impact companies in the solar space. The recent capacity expansion plans of Canadian Solar come with the rationale to ease such supply-chain disruptions and improve delivery times.
Also, such a vertically integrated manufacturing process will provide Canadian Solar with a competitive edge, enabling the company to meet the growing demand for solar products proactively with its unique products and services. It may also stabilize the cost structure for CSIQ, taking it to relatively the bottom of the cost curve.
Expanding its vertically integrated manufacturing capacity is also likely to result in better control over the production capacity and adjust the production level per demand.
Canadian Solar already boasts a large customer pipeline across key markets in the United States, China, Japan, the U.K. and Canada, and emerging markets in Brazil, India, Mexico, Italy, Germany, South Africa and the Middle East. Such capacity expansion will probably consolidate CSIQ’s positioning in the global solar market, thereby strengthening its customer base significantly and reaping a handful of returns for the company.
Solar Companies’ Focus on Capacity Expansion
Nations are gradually moving toward renewable sources of energy to curtail the carbon footprint. This has resulted in substantial demand for solar-related products, with both small-scale solar projects and large-scale solar projects like utility-scale solar projects being the major drivers.
In such a scenario, other than Canadian Solar, solar companies that have opted to expand manufacturing capacity to meet the growing global demand are as follows:
Enphase Energy (ENPH - Free Report) added an automated line at Flex's factory in Romania. This line has a quarterly capacity of approximately 750,000 microinverters. It will enable a global capacity of nearly six million microinverters per quarter, with plans to further escalate capacity.
Enphase boasts a long-term (three-five) earnings growth rate of 45.4%. ENPH shares have increased 2.9% in the past year.
First Solar (FSLR - Free Report) is investing heftily in the production ramp-up of solar modules to expand its manufacturing capacity. It announced plans to expand its manufacturing capacity by 6.6 GW by constructing its third manufacturing facility in the United States and first manufacturing facility in India.
The new facilities are expected to commence operations in the first half of 2023 and the second half of 2023, respectively. The company is now projected to build its fourth manufacturing facility in the United States, which is expected to commence operations in 2025.
The Zacks Consensus Estimate for First Solar’s 2023 sales suggests a growth rate of 34.4% from the prior-year reported figure. Shares of FSLR have surged 166.2% in the past year.
In May 2022, SolarEdge (SEDG - Free Report) announced the opening of Sella 2, a two-gigawatt-hour battery cell manufacturing facility. Sella 2 enables the company to have its supply of lithium-ion batteries and the infrastructure to develop new battery cell chemistries and technologies.
SolarEdge’s long-term earnings growth rate is pegged at 31%. SEDG shares have rallied 47.3% in the past six months.
Price Movement
In a year, shares of Canadian Solar have soared 13% compared with the industry’s growth of 17.8%.
Image Source: Zacks Investment Research
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.