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Canadian Solar (CSIQ) Gains As Market Dips: What You Should Know

Zacks Equity Research
Tree.com (TREE) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

Canadian Solar (CSIQ) closed the most recent trading day at $20.58, moving +0.24% from the previous trading session. This change outpaced the S&P 500's 0.15% loss on the day. At the same time, the Dow added 0.21%, and the tech-heavy Nasdaq lost 0.81%.

Coming into today, shares of the solar wafers manufacturer had gained 43.17% in the past month. In that same time, the Oils-Energy sector gained 9.8%, while the S&P 500 gained 6.55%.

CSIQ will be looking to display strength as it nears its next earnings release, which is expected to be March 18, 2019. The company is expected to report EPS of $0.56, down 44.55% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $728.65 million, down 34.28% from the prior-year quarter.

Any recent changes to analyst estimates for CSIQ should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. CSIQ currently has a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that CSIQ has a Forward P/E ratio of 8.54 right now. This valuation marks a discount compared to its industry's average Forward P/E of 14.23.

Also, we should mention that CSIQ has a PEG ratio of 0.27. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Solar industry currently had an average PEG ratio of 0.84 as of yesterday's close.

The Solar industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 68, putting it in the top 27% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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