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Canadian Solar's (CSIQ) Unit Inks PPA With Energy Transfer

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Canadian Solar Inc.’s (CSIQ - Free Report) wholly-owned subsidiary — Recurrent Energy — has signed a Power Purchase Agreement (PPA) to supply 40 megawatts peak (MWp) / 28 MWac solar power to Energy Transfer (ET - Free Report) for a period of 15 years.

Recurrent Energy will develop the Maplewood 2 solar project, which is located in Pecos County in the Permian Basin of West Texas. Also, Recurrent Energy is developing another solar project, Maplewood, which will deliver 222 MWac/310 MWp of electricity to Anheuser-Busch under a 15-year PPA. The projects are expected to be operational by 2021 and will power nearly 62,000 homes in the region.                                                                                                                                                      

Other Projects in Pipeline

Canadian Solar has a strong pipeline of projects to consolidate its position. The company continues to identify attractive development opportunities to redeploy capital and ensure future success. As of April 30, 2019, the company’s utility-scale solar power plants in operation totaled 983.6 (MWp), with an estimated resale value of approximately $1.2 billion. Moreover, the company’s late-stage utility-scale solar pipelines, including the units under construction, increased to 3.4-gigawatt peak (GWp).

Rising Demand for Renewables

Renewable energy sources are gaining popularity as they are environment friendly and reduce emissions. Per U.S. Energy Information Administration (EIA), U.S. energy-related carbon dioxide (CO2) emissions will decline by 2.1% in 2019 and by 0.8% in 2020. EIA forecasts that all renewable fuels — including wind, solar, and hydropower — will produce 18% of electricity in 2019 and almost 20% in 2020 in the United States.

With solar being one of the key resources in the renewable space, it is imperative to mention that Canadian Solaris significantly boosting its footprint in the United States.As of April 30, 2019, the company's late-stage, utility-scale solar project pipeline totaled 1,525 MWp.

Zacks Rank & Price Movement

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


In the past 12 months, the company’s shares have surged 71.9% compared with the industry’s rally of 26.2%.

Key Picks

Some better-ranked stocks in the solar industry are JinkoSolar Holding Company Ltd. (JKS - Free Report) and Enphase Energy, Inc. (ENPH - Free Report) .

Estimates for JinkoSolar’s 2019 earnings have moved up 0.6% to $2.98 per share in the past 90 days. The company sports a Zacks Rank #1. The company’s long-term (three to five years) earnings growth is pegged at 20%.

Estimates for Enphase Energy’s 2019 earnings have surged 73.3% to 52 cents in the past 90 days. The stock carries a Zacks Rank #2 (Buy). The company’s average four-quarter positive earnings surprise is 31.67%.

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