Canadian Solar Fails to Hold Gain
Less than 10 days before it is due to release first-quarter results, Canadian Solar on Wednesday issued "selective" preliminary results for the quarter, perhaps trying to recapture lost share value.
Less than 10 days before the company is due to release first-quarter results, Canadian Solar Inc. (NASDAQ: CSIQ) on Wednesday issued “selective” preliminary results for the quarter. Exactly what the company had to gain is a little unclear.
When Canadian Solar last reported earnings in early March, the company forecast shipments of 470 to 490 megawatts of solar modules, for total revenue in the range of $415 million to $430 million and gross margins of 14% to 16%. Now the company has said it would ship 490 to 500 megawatts of solar modules and that revenue would rise to a new range of $460 million to $470 million, even though gross margins have been trimmed a little to a new range of 14% to 15%.
That looks like an improvement until one recalls that the March consensus estimate for first-quarter revenues came to $517.78 million. In March, the company’s stock had appreciated by more than 1,000% in the past 12 months. For the 12 months through Tuesday, the stock was up about 400%, still a nosebleed level, but off 21% year-to-date.
When trading opened Wednesday, Canadian Solar’s shares were up about 4.5% and climbed to a gain of about 7% before turning to a loss of about 3%. In the noon hour, it was trading up 1.3%, at $27.33 in a 52-week range of $5.18 to $44.50.
Canadian Solar was probably hoping that the preliminary announcement would recapture some of the 30% of its share value that it lost since reporting fourth-quarter results in early March. The finesse seems to have mostly failed.
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Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.
