• Canadian Solar Inc. announced that its e-STORAGE business has delivered its first grid-connected SolBank-based battery energy storage system in Japan and entered long-term supply and service agreements for two standalone SolBank 3.0 battery projects totaling 503 MWh DC in Texas.
• These moves highlight e-STORAGE’s growing global footprint and its role in grid flexibility and renewable integration across both regulated Japanese markets and the competitive ERCOT market.
• We’ll now examine how e-STORAGE’s first Japanese grid project and large Texas BESS contracts may influence Canadian Solar’s investment narrative.

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Canadian Solar Investment Narrative Recap

To own Canadian Solar, you need to believe its pivot toward higher value battery storage and integrated solutions can gradually offset pressure on module margins and capital intensity. The Japan and Texas e‑STORAGE wins reinforce that shift, but do not remove key near term risks around elevated manufacturing costs, thin profitability, and policy uncertainty, especially in the U.S., where incentives and trade rules remain in flux.

Among recent announcements, the formation of CS PowerTech to localize U.S. manufacturing and storage operations looks especially relevant. It ties directly into Canadian Solar’s effort to secure access to U.S. demand amid evolving FEOC and tariff rules, while projects like the Lupinus BESS contracts and first Japanese grid system show how e‑STORAGE could support revenue diversification if execution and costs stay under control.

Yet against this progress, investors should not overlook the risk that rising tariffs and stricter FEOC rules could squeeze margins and limit market access over the coming years...

Canadian Solar's narrative projects $8.0 billion revenue and $201.9 million earnings by 2028. This requires 10.4% yearly revenue growth and about a $208.8 million earnings increase from -$6.9 million today.

Uncover how Canadian Solar's forecasts yield a $23.33 fair value, a 18% upside to its current price.

Exploring Other Perspectives

Some of the lowest ranked analysts were expecting revenue of about US$7.6 billion and only US$39.3 million in earnings by 2028, so compared with that more cautious view of policy and cost risks, this new Japan and Texas storage news could eventually shift how you weigh those downside assumptions against the potential of e STORAGE to improve profitability.

Explore 6 other fair value estimates on Canadian Solar - why the stock might be worth less than half the current price!

The Verdict Is Yours

Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.

• A great starting point for your Canadian Solar research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Canadian Solar research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Canadian Solar's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.