GUELPH, ON - Canadian Solar Inc. (NASDAQ: NASDAQ:CSIQ) reported the commencement of commercial operations for its inaugural portfolio of feed-in premium (FIP) photovoltaic (PV) projects in Japan as of June 1, 2024. The portfolio includes a 1.2 megawatt peak (MWp) project in Tsukuba City, Ibaraki Prefecture, and a 1.9 MWp project in Daisen Town, Tottori Prefecture, both utilizing the company's CS7N-660W bifacial modules.
The switch from a feed-in tariff (FIT) to a FIP for these projects was a strategic response to the growing demand for renewable energy sources. This allows the projects to generate additional revenue through Non-Fossil Certificates (NFCs).
Toyota (NYSE:TM) Tsusho Corporation, part of the Toyota Group and an electricity retailer, has entered into a 20-year Power Purchase Agreement (PPA) with Canadian Solar. Under this agreement, Toyota Tsusho will acquire 100% of the power and NFCs from the project, which it will then provide to its corporate customers.
Ryota Yamada, General Manager of Canadian Solar's Japan Energy Group, highlighted the company's focus on meeting the clean energy demands of enterprises. With a project development business in Japan that totals 240 MWp and 1.675 GWh for solar and energy storage respectively as of March 31, 2024, Canadian Solar is pleased to support Japanese corporations in their clean energy initiatives.
Canadian Solar, established in 2001, is recognized as one of the world's leading solar technology and renewable energy companies. It has delivered over 125 GW of solar photovoltaic modules worldwide and has developed significant solar power and battery energy storage projects. The company has a diverse pipeline of projects in various stages of development, including over 1.2 GWp of solar power projects in operation and a battery energy storage project development pipeline of around 56 GWh.
The information in this article is based on a press release statement from Canadian Solar Inc.
In other recent news, Canadian Solar's subsidiary, Recurrent Energy, in collaboration with SPIC Brasil, inaugurated the 446 MWp Marangatu Solar Complex in Brasileira, Brazil. The complex is expected to supply electricity to approximately 550,000 homes annually. The development has also positively impacted the local job market, generating around 2,000 jobs. Recurrent Energy continues to grow in Latin America, with a project development pipeline exceeding 4 GW.
In financial news, Canadian Solar reported strong Q1 2024 results, with revenues of $1.3 billion and module shipments totaling 6.3 gigawatts. The company is also focusing on expanding its energy storage solutions, aiming to operate 4 gigawatts of solar and 2 gigawatt-hours of battery energy storage by 2026.
In analyst notes, Oppenheimer has adjusted its outlook on Canadian Solar, reducing the price target to $43 from $51, while maintaining an Outperform rating. This decision comes in response to the company's strategic shift in solar module shipments, particularly to China. Despite these changes, Canadian Solar is experiencing growth in its battery business and has a robust project backlog in energy storage.
InvestingPro Insights
As Canadian Solar Inc. (NASDAQ: CSIQ) makes strides in the renewable energy market with its latest projects in Japan, the company's financial metrics provide a deeper insight into its market position and performance. According to InvestingPro data, Canadian Solar is currently trading at a low Price / Book multiple of 0.45, suggesting that the company's stock might be undervalued relative to its assets. This metric is particularly relevant for investors looking for potential value plays in the solar technology sector.
Despite the challenges faced by the industry, including a decrease in revenue growth over the last twelve months by 8.56%, Canadian Solar maintains a robust gross profit margin of 17.0%. This indicates that the company is still able to effectively manage its cost of goods sold and maintain profitability in its operations. Additionally, the company's P/E Ratio stands at 5.57, which might appeal to investors seeking companies with lower earnings multiples.
For those interested in further analysis and metrics, there are additional InvestingPro Tips available for Canadian Solar. These tips provide insights such as the company's cash burn rate and analysts' earnings revisions, which could be crucial for assessing the company's future prospects. To explore these tips and more, visit https://www.investing.com/pro/CSIQ and remember to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. There are 13 more InvestingPro Tips listed on InvestingPro that can help investors make more informed decisions regarding Canadian Solar Inc.
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