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Canadian Solar (CSIQ) Q1 Earnings Top, Revenues Rise Y/Y

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Canadian Solar Inc. (CSIQ - Free Report) reported first-quarter 2020 adjusted earnings of $1.40 per share, which surpassed the Zacks Consensus Estimate of $1.16 by 20.7%.

Including one-time items, GAAP earnings came in at $1.84 per share in the quarter under reviewagainst loss of 29 cents in first-quarter 2019.

Total Revenues

This solar cell manufacturer’s total revenues of $825.6 million beat the Zacks Consensus Estimate of $795 million by 3.9%. The top line also improved a solid 70.3% from $484.7 million reported in first-quarter 2019. The top line exceeded theguidance of $780-$810 million.  

The year-over-year improvement is attributable to solid module shipments and project sales.

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

Operational Update

Solar module shipments in the quarter totaled 2,214 megawatts (MW), which exceeded the mid-point of the guided range of 2.15-2.25 gigawatts (GW).This includes 253 MW for the company's utility-scale solar power projects. Module shipments increased 40.6% on a year- over-year basis.

Gross margin was 27% in the quarter, compared with 22.2% in the year-ago quarter. The upside was driven by increased contribution of higher margin project sales.

Total operating expenses were $109.8 million, up 8.9% year over year. The increase in operating costs in the reported quarter was due to higher general and administrative expenses as well as selling expenses.
Interest expenses were $19 million, down from $21.7 million recorded in the year-ago period.

Financial Update

As of Mar 31, 2020, cash and cash equivalents totaled $618.6 million, down from $668.7 million on Dec 31, 2019.

Long-term borrowings as of Mar 31,2020 were $665.8 million, up from $619.5 million on Dec 31, 2019.

Guidance

For second-quarter 2020, Canadian Solar expects shipments in the range of 2.5-2.7 GW. This guidance includes approximately 200 MW of shipments to its utility-scale solar power projects that may not be recognized as revenues in the second quarter. Total revenues are projected within $630-$680 million, while gross margin is expected in the band of 18.5-20.5%.

The Zacks Consensus Estimate for the company’s second-quarter revenues is pegged at $794.7 million, higher than the guided range.

For 2020, Canadian Solar still expects total module shipments in the range of 10-12 GW. However, in light of the uncertainty with respect to business conditions in the second half of 2020 due to COVID-19, Canadian Solar withdrew its earlier announced 2020 annual revenue guidance.

Zacks Rank

Canadian Solar currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Q1 Releases of Other Solar Players

Enphase Energy (ENPH - Free Report) reported first-quarter 2020 adjusted earnings of 38 cents per share, which surpassed the Zacks Consensus Estimate of 32 cents by 18.8%. The bottom line surged a massive 375% from 8 cents reported in the prior-year quarter.

SolarEdge Technologies, Inc. (SEDG - Free Report) reported first-quarter 2020 adjusted earnings of $1.03 per share, which missed the Zacks Consensus Estimate of $1.20 by 14.2%. The bottom-line, however, surged 47.1% from 70 cents reported in the prior-year quarter.

First Solar (FSLR - Free Report) reported first-quarter 2020 adjusted earnings of 85 cents per share, which surpassed the Zacks Consensus Estimate of 24 cents by 254.2%. The bottom line also improvedfrom the year-ago quarter's loss of 64 cents per share.

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