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

Zacks Equity Research
Aon (AON) 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 $19.79, moving -0.9% from the previous trading session. This change lagged the S&P 500's daily gain of 0.47%. Elsewhere, the Dow gained 0.68%, while the tech-heavy Nasdaq added 0.74%.

Prior to today's trading, shares of the solar wafers manufacturer had gained 18.87% over the past month. This has outpaced the Oils-Energy sector's gain of 7.05% and the S&P 500's gain of 7.71% in that time.

Investors will be hoping for strength from CSIQ as it approaches its next earnings release. The company is expected to report EPS of $0.56, down 44.55% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $728.65 million, down 34.28% from the year-ago period.

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 a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. CSIQ currently has a Zacks Rank of #2 (Buy).

In terms of valuation, CSIQ is currently trading at a Forward P/E ratio of 8.31. This valuation marks a discount compared to its industry's average Forward P/E of 15.56.

We can also see that CSIQ currently has a PEG ratio of 0.26. 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 0.89 as of yesterday's close.

The Solar industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 52, which puts it in the top 21% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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Canadian Solar Inc. (CSIQ) : Free Stock Analysis Report
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