Will Canadian Solar Continue its Downward Spiral?CSIQ).
2015 was an awful year for almost every oil company as oil prices declined from $69 per barrel to almost $30 per barrel previous year.
Over the last few years, Canadian Solar has turn into a foremost solar player and is even starting to compete against the likes of SunPower and First Solar in terms of revenue. Despite the instability experienced by Canadian Solar previous year, the company has performed comparatively nicely during that period. Keeping in mind Canadian Solar’s speedy growth and efficient cost structure, the company’s recent achievement will probably prolong into the future.
Canadian Solar is bolstering its reputation as a cost leader in the extremely competitive solar producing industry. During Q3FY15, the company’s polysilicon, module, and cell costs came in at $0.18 per watt, $0.14 per watt, and $0.10 per watt respectively. Canadian Solar’s low costs are almost unique in the competitive sector and have been a chief driving force for the company’s future growth. With the overall manufacturing cost structure of $0.42, Canadian Solar can only be compared to few solar firms including Trina Solar.
As the financial side of solar will likely progress at a hasty rate mainly due to the recent worldwide climate deal, Canadian Solar holds an even superior position. The company will probably be able to yield benefit of new markets across the globe as various countries start to familiarise pro-solar policies. Apart from this, Canadian Solar’s acquisition of Recurrent Energy is playing an enormous role in escalating the company’s presence in the U.S.
With renewable energy expected to grow at a rapid rate over the next few years, I think long-term investors can consider buying the stocks in the solar industry. Canadian Solar is currently one of my favourite picks, and as explained above, I think investors can consider buying it on the pullback.
Published on Feb 8, 2016By Akshansh Gandhi