Canadian Solar Inc. CSIQ continues to benefit from a strong pipeline of solar and energy storage projects. It keeps building momentum in the fast-growing battery energy storage business with its e-STORAGE platform.
However, this Zacks Rank #3 (Hold) company faces risks related to industry oversupply and cost volatility.
Factors Acting in Favor of CSIQ Stock
In the first quarter of 2026, Canadian Solar shipped modules and system kits to more than 60 countries and regions, with North America accounting for 45% of shipments. Management focused on higher-return markets, reduced lower-margin volumes, and managed shipments amid higher input costs, including silver. The company also consolidated oversight of its U.S. operations under CS PowerTech, while CSI Solar serves other global markets to better align supply with U.S. demand.
Canadian Solar operates a five GWp solar module factory in Mesquite, TX, and expects to expand it to 10 GWp nameplate capacity by the second half of 2026. It also commenced trial production at its Jeffersonville, IN, heterojunction technology solar cell facility in April 2026, with commercial operation targeted to begin in July 2026.
As of March 31, 2026, Canadian Solar reported a total solar project development pipeline of 23.7 GWp and a battery energy storage project development pipeline of 80.6 GWh. It had secured interconnections for about seven GW of solar and 14 GWh of storage globally, excluding projects already in operation. e-STORAGE’s contracted backlog was $3.5 billion as of May 8, 2026, including long-term service agreements covering 34 GWh of operating projects.
Headwinds for CSIQ Stock
The solar market remains highly competitive, which limits pricing power and makes it harder for module price increases to fully offset higher upstream costs. Management noted that elevated feedstock costs, including silver, and the company’s second-quarter 2026 gross margin guidance of 13-15% suggest continued margin sensitivity as the benefits from one-time items fade.
In storage, management said competition is intensifying, margins are normalizing, and results remain partly exposed to lithium carbonate price swings. Together, these factors can keep profitability volatile if costs rise faster than selling prices.
CSIQ’s Share Price Performance
In the past three months, shares of the company have risen 20.8% compared with the industry’s 15.2% growth.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the same sector are T1 Energy Inc TE, FuelCell Energy FCEL and GE Vernova Inc. GEV, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for TE’s 2026 earnings per share (EPS) implies an increase of 85.3% from that recorded in 2025. The Zacks Consensus Estimate for TE’s 2026 sales implies year-over-year growth of 19.1%.
The Zacks Consensus Estimate for FCEL’s fiscal 2026 EPS implies an increase of 59.4% from that recorded in fiscal 2025. The company delivered an average earnings surprise of 14.4% in the last four quarters.
The Zacks Consensus Estimate for GEV’s 2026 EPS implies an increase of 72.9% from that recorded in 2025. The company delivered an average earnings surprise of 83.6% in the last four quarters.
Research Chief Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
Free: See Our Top Stock And 4 Runners UpWant 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
T1 Energy Inc (TE): Free Stock Analysis Report
Canadian Solar Inc. (CSIQ): Free Stock Analysis Report
FuelCell Energy, Inc. (FCEL): Free Stock Analysis Report
GE Vernova Inc. (GEV): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).