Bear of the Day: Canadian Solar (CSIQ)

Canadian Solar Company OverviewZacks Rank #5 (Strong Sell) stock Canadian Solar (CSIQ) is an Ontario-based global renewable energy company founded in 2001. The company produces solar photovoltaic modules and delivers complete solar energy solutions. CSIQ has two primary businesses: CSI Solar, which focuses on producing solar modules and battery storage systems, and Recurrent Energy, which develops and manages utility-scale solar and energy storage projects. The company’s products include a range of solar modules built for use in a wide range of residential, commercial, and industrial solar power generation systems.Trump Tariffs are a Potential Headwind for Canadian SolarFor decades, Donald Trump has talked about how the United States is being taken advantage of by other countries on trade, leading to unfair trade imbalances. During his first term, he was able to negotiate the USMCA (United States-Mexico-Canada Agreement). However, once again back in power Trump, and this time with a “mandate,” Trump is looking to level the playing field more this time. In doing so, he has declared April 2nd “Liberation Day” for America – a day where he will levy “reciprocal” tariffs on countries that he feels are abusing the United States.  While the full details of the Trump tariff plan will not be unveiled until April 2nd, Canada appears to be in the crosshairs. In fact, Canada, which supplies parts of the US with energy, threatened to add a surcharge to electricity for US customers. Though the energy surcharge has been removed, the rhetoric between the US and Canada has reached a tipping point. The new tariffs will likely include solar panels and raw materials needed to manufacture them.Increased Competition from ChinaThe average selling price of solar modules is decreasing significantly due to increased manufacturing capacity in China from companies like Jinko Solar (JKS). Chinese competitors dominate the market, flooding it with an oversupply of solar products while driving down prices globally. Meanwhile, Tesla’s (TSLA) energy storage and energy generation business is has grown 67% year-over-year, while deployments have soared.Canadian Solar Remains UnprofitableWall Street analysts project that will lose money in 2025. Meanwhile, tariffs and Chinese competition could make those losses more profound. In addition, CSIQ has a negative Zacks Earnings “Expected Surprise Prediction” score, which suggests that a negative earnings surprise will likely occur next time the company reports.CSIQ Exhibits Relative WeaknessCSIQ’s relative weakness over the past year is troubling. The stock is down 56% while the S&P 500 Index is up 6.8% over the same time.Image Source: Zacks Investment ResearchBottom LineThe evolving global trade landscape, increased competition from China, and falling solar prices mean Canadian Solar faces significant headwinds in the coming months.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.3% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report JinkoSolar Holding Company Limited (JKS): Free Stock Analysis Report Canadian Solar Inc. (CSIQ): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks