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Emeren Group (SOL) Buys 86 MWp Solar Portfolio in Spain

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Emeren Group Ltd. (SOL - Free Report) recently completed the purchase of an 86 Megawatt-peak (MWp) utility-scale solar project portfolio in Spain from Negratin Global Services.

The portfolio comprises 13 utility-scale solar projects ranging from 6 megawatt direct current (MW DC) to 14 MW DC. These projects come under the Ready-to-Build category and are expected to produce 166,471,371 kilowatt-hour (kWh)/year of energy.

All 13 projects, expected to begin construction in late 2024 and connected to the grid by early 2025, will have the capacity to provide energy to 51,380 households and save 19,544 vehicle emissions every year.

Emeren’s Prospects in Europe’s Solar Market

Emeren is steadily gaining momentum in Europe’s solar market. The company seems to be gradually expanding in Germany, France, Spain, Poland, Hungary and Italy. Europe contributed 68% to the total revenues of the company in the last reported quarter.

In this context, Emeren’s endeavors appear to be robust and purposeful as it seeks to bolster its footprint in the European solar market. Recently, it sold a 53.6 MWp solar portfolio in Hungary. In November 2023, Emeren monetized 29 MW of solar PV portfolio in Spain and closed the sale of a portfolio in Italy, comprising five Battery Energy Storage Systems with a capacity of 3,787 MWh to Matrix Renewables.

Emeren Spain has an advanced-stage portfolio of more than 300 MW in solar and 100 MWh of storage, with a 2024/2025 pipeline of more than 4 gigawatts (GW).

Such endeavors are likely to provide meaningful gains to the company in the days ahead, which can be further gauged by a recent projection from SolarPower Europe. Per the report, new solar photovoltaic capacity is likely to exceed 50 GW of deployment in 2023. The solar projects are expected to reach 85 GW in 2026 from its current levels.

In light of such growth expectations and the recent purchase, it is reasonable to assume that Emeren’s expansion plans in Europe could prove to be prudent, potentially enhancing its revenue generation prospects in the region.

European Solar Market Prospects Look Promising

The promising growth outlook for Europe’s solar market should also benefit other solar companies that have significant involvement in this region’s solar market:

Canadian Solar (CSIQ - Free Report) : It has a presence in Germany, the U.K., Poland, Spain, Italy, France and the Netherlands.  As of September 2023, the company had 3,756 MW of early-stage pipeline in the EMEA region. In November 2023, e-STORAGE, Canadian Solar’s subsidiary, was selected as the supplier for Engineering, Procurement and Construction and Operations and Maintenance by Copenhagen Infrastructure Partners to deliver its Summerfield battery storage project, a 2-hour 240 MW (480 MWh) DC energy storage solution in South Australia.

The Zacks Consensus Estimate for CSIQ’s 2023 earnings per share (EPS) implies growth of 7% from the 2022 reported figure. The Zacks Consensus Estimate for 2023 sales indicates an improvement of 1.2% from the prior-year reported number.

Maxeon Technologies (MAXN - Free Report) : Maxeon Solar supplies modules for Italy’s largest Airport PV installation in Torino. During third-quarter 2023, the Europe, Middle East and Africa region comprised $65 million of its total revenues. The company also commenced sales of battery storage products in Belgium, France, Italy and Spain during this period.

The stock currently boasts a long-term (three-to five-years) earnings growth of 39.7%. The Zacks Consensus Estimate for MAXN’s 2023 sales implies an improvement of 7.2% from the 2022 reported figure.

SolarEdge (SEDG - Free Report) : SolarEdge has a strong presence in Germany, the U.K. and Switzerland. It expects the momentum to continue growing in Europe. With third-quarter 2023 revenues from Europe comprising 62% of the total, the company shipped 2,585 MW of energy to Europe.

SEDG has a long-term earnings growth rate of 18.7%.  Its shares have risen 21.6% in the past month.

Price Performance

In the past six months, shares of SOL have lost 26.9% compared with the industry’s 28.4% decline.

Zacks Investment Research
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Zacks Rank

Emeren Group currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
 

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