Please ensure Javascript is enabled for purposes of website accessibility

A Trio of Solar Tidings

By Toby Shute – Updated Nov 11, 2016 at 6:25PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

There's good news all around for this solar player.

There have been three positive developments for Canadian Solar (NASDAQ:CSIQ) since Friday. The company told you about two of them today, but you won't see the very best news in a company press release. We'll save that one for last.

One item is about a large solar-cell supply deal with Taiwanese Neo Solar. It's true that as an integrated player, Canadian Solar manufactures its own cells, but in order to meet blistering demand for modules, the company is also sourcing third-party cells. Neo will provide several hundred megawatts' worth over the next five years. At more than half a billion dollars, this is a major contract -- though nowhere near as massive as Suntech Power's (NYSE:STP) recent silicon score.

Canadian Solar has also firmed up its alliance with metal specialist Timminco. This Canadian upstart in the field of upgraded metallurgical grade (UMG) silicon -- the poor man's polysilicon -- has collaborated with Canadian Solar for more than a year now. With the recent commercial introduction of Canadian Solar's e-Modules, the solar maker is now a key strategic partner for Timminco, which has agreed to supply 5,000 metric tons of UMG silicon through 2011.

Until we learn more about the e-Modules' grams-per-watt consumption, we won't know exactly how much end-user product will result from this supply deal. I'm hoping that the official product launch in Germany this month will provide some specs.

Speaking of Germany, here's the really big news. The government on Friday moved ahead with cuts to solar subsidies, but the reductions are far less than feared. That's huge for not only Canadian Solar, but other Euro-weighted solar suppliers like First Solar (NASDAQ:FSLR), Energy Conversion Devices (NASDAQ:ENER), and SunPower (NASDAQ:SPWR).

Between this modest weaning and the company's renewed strength in its supply chain, Canadian Solar appears to be comfortably positioned for profits.

Related Foolishness:

None

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

SunPower Corporation Stock Quote
SunPower Corporation
SPWR
$24.69 (-1.95%) $0.49

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
339%
 
S&P 500 Returns
109%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/24/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.