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Emeren Group (SOL)
NYSE:SOL
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Emeren Group
(NYSE:SOL)
49Neutral
Positive Factors
Gross Margin Improvement
Gross margins improved to 43.8% from 31.2% in 2Q24 and 40.8% in 3Q23.
Revenue Potential
There is potential upside to the company's revenues, especially because of the DSA contracted backlog of $84M and an additional $100M under negotiations.
Negative Factors
Delayed Approvals
The company's 4Q24 revenues were lower than expectations due to delays in government approvals for several projects in Europe.
Market Environment
Emeren is navigating a choppy macro environment for solar project deployments, which is limiting the company's ability to deliver on its outlook in a consistent manner.
Revenue Outlook
The company lowered its revenue outlook for 2024 to $97-102M from $150-160M previously.
Emeren Group (SOL) vs. S&P 500 (SPY)
Market Cap
$87.56M
Dividend YieldN/A
Average Volume (3M)492.46K
Price to Earnings (P/E)―
Beta (1Y)1.52
Revenue Growth-12.04%
EPS Growth-1249.77%
CountryUS
Employees197
SectorTechnology
Sector Strength51
IndustrySolar
Share Statistics
EPS (TTM)-2.31
Shares Outstanding51,254,955
10 Day Avg. Volume1,120,961
30 Day Avg. Volume492,460
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.91
Price to Cash Flow (P/CF)-9.60
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$4.50Price Target Upside167.86% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Emeren Group Business Overview & Revenue Model
Company DescriptionEmeren Group (SOL) is a company operating in the renewable energy sector, focusing on solar energy solutions. The company is involved in the development, construction, and operation of solar power projects, contributing to the transition towards more sustainable energy sources. Emeren Group provides comprehensive services including project development, engineering, procurement, and construction (EPC), as well as operations and maintenance (O&M) services for solar power installations.
How the Company Makes MoneyEmeren Group makes money through multiple revenue streams primarily centered around its solar energy projects. The company generates revenue by developing and selling solar power plants, offering EPC services to third parties, and providing long-term O&M services for solar installations. Additionally, Emeren Group may enter into power purchase agreements (PPAs) where it sells generated electricity directly to utilities or commercial customers. Significant partnerships with financial institutions, technology providers, and local governments can enhance project financing and execution, contributing to the company's earnings.
Emeren Group Financial Statement Overview
Summary
Emeren Group faces challenges with declining revenues and profitability, evident in the negative net profit margins and reduced revenue growth. While the balance sheet is robust with low leverage and a high equity ratio, the cash flow statement indicates significant issues in cash generation and management. Overall, the company needs to address operational inefficiencies and improve cash flow management to enhance financial performance.Income Statement
The company has experienced a negative revenue growth rate of -12.7% in the TTM compared to the previous year, reflecting a decline in sales. The gross profit margin stands at 25.8%, showing a decent ability to manage production costs. However, the net profit margin is negative at -12.7%, indicating the company is not profitable. The EBIT margin is low at 0.6%, with the EBITDA margin slightly better at 7.2%, suggesting operational challenges.45
Neutral
Balance Sheet
The balance sheet shows a strong equity base with an equity ratio of 75.5%, indicating financial stability and low leverage. The debt-to-equity ratio is 0.12, suggesting a conservative approach to debt usage. Return on equity is negative at -3.5%, reflecting the unprofitability and inefficiency in using equity to generate income.60
Neutral
Cash Flow
The company has a negative free cash flow growth rate of -55.8% in the TTM, highlighting challenges in generating cash. Operating cash flow to net income ratio is -0.36, suggesting difficulties in converting net income into cash. The free cash flow to net income ratio is -1.29, further emphasizing cash flow constraints.38
Negative
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 92.25M | 105.64M | 81.41M | 79.66M | 73.92M | 119.12M | Gross Profit |
| 23.83M | 25.01M | 24.48M | 31.42M | 17.17M | 34.23M | EBIT |
| 576.00K | -8.66M | 7.47M | 12.65M | 2.33M | -1.06M | EBITDA |
| 6.64M | 7.13M | 8.06M | 19.92M | 16.71M | 7.75M | Net Income Common Stockholders |
| -11.71M | -3.19M | 5.90M | 6.86M | 2.78M | -11.68M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 76.72M | 70.17M | 107.11M | 254.07M | 40.59M | 24.29M | Total Assets |
| 481.73M | 478.35M | 500.51M | 529.27M | 337.35M | 319.94M | Total Debt |
| 68.98M | 60.83M | 70.59M | 57.85M | 115.58M | 121.28M | Net Debt |
| 2.25M | -9.35M | -36.51M | -196.22M | 74.99M | 96.99M | Total Liabilities |
| 105.09M | 115.04M | 100.99M | 80.86M | 153.62M | 182.40M | Stockholders Equity |
| 335.69M | 325.31M | 358.17M | 404.01M | 139.61M | 94.72M |
| Cash Flow | Free Cash Flow | ||||
| -15.13M | -34.23M | -72.87M | -18.03M | -22.18M | 42.22M | Operating Cash Flow |
| -4.21M | -23.49M | -35.25M | -6.42M | -13.93M | 55.91M | Investing Cash Flow |
| -15.66M | 15.31M | -37.06M | 19.39M | 510.00K | -1.60M | Financing Cash Flow |
| -5.93M | -25.26M | -70.25M | 204.88M | 30.18M | -39.30M |
Emeren Group Technical Analysis
Neutral
1.68
Price Trends
1.72
Negative
1.88
Negative
1.92
Negative
Market Momentum
-0.02
Negative
53.72
Neutral
84.65
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SOL, the sentiment is Neutral. The current price of 1.68 is above the 20-day moving average (MA) of 1.55, below the 50-day MA of 1.72, and below the 200-day MA of 1.92, indicating a neutral trend. The MACD of -0.02 indicates Negative momentum. The RSI at 53.72 is Neutral, neither overbought nor oversold. The STOCH value of 84.65 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SOL.
Emeren Group Risk Analysis
Emeren Group disclosed 44 risk factors in its most recent earnings report. Emeren Group reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Emeren Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $13.79B | 10.72 | 17.62% | ― | 26.75% | 55.24% | |
68 Neutral | $8.15B | 84.20 | 11.30% | ― | -41.92% | -76.24% | |
58 Neutral | $22.11B | 10.47 | -17.86% | 2.40% | 4.75% | -24.81% | |
53 Neutral | $659.10M | 708.39 | 0.03% | ― | -21.68% | -99.75% | |
51 Neutral | $1.01B | ― | -116.01% | ― | -68.86% | -4917.87% | |
49 Neutral | $87.56M | ― | -3.99% | ― | -12.04% | -1249.77% | |
46 Neutral | $1.49B | ― | -73.12% | ― | -9.83% | -71.44% |
* Technology Sector Average
Performance Comparison
SOL
Emeren Group
1.68
-0.23
-12.04%
CSIQ
Canadian Solar
9.70
-8.28
-46.05%
ENPH
Enphase Energy
62.16
-47.19
-43.16%
FSLR
First Solar
128.82
-24.34
-15.89%
SEDG
SolarEdge Technologies
17.20
-46.23
-72.88%
RUN
Sunrun
6.56
-4.72
-41.84%
Emeren Group Earnings Call Summary
Earnings Call Date: Mar 13, 2025 | % Change Since: 14.29% | Next Earnings Date: May 29, 2025
Earnings Call Sentiment Neutral
The earnings call highlights a mixed performance. While there are strong points such as a significant increase in cash position, strategic project monetization, and expanding energy storage initiatives, there are also notable challenges including a year-over-year revenue decline, increased net loss, and project delays impacting revenue recognition.Highlights
Strong Cash Position
Ended the year with $50 million in cash, up 40% sequentially from $35.8 million in Q3 2024, reinforcing strong liquidity.
Significant Revenue Increase in Q4
Revenue surged 169% quarter by quarter, driven by successful project monetization.
Strategic Project Monetization
Successfully closed several strategic transactions in Europe, US, and China, solidifying leadership in renewable energy monetization.
Positive Operating Cash Flow
Generated $10.4 million in operating cash flow and over $5 million in free cash flow in Q4.
Expanding Energy Storage Initiatives
Executed a 462-megawatt DSA for battery energy storage systems in Italy.
Lowlights
Revenue Decline Year Over Year
Delivered $34.6 million in revenue in Q4, down 23% year over year, primarily due to project delays pending government approvals.
Net Loss Increase
Net loss attributable to Emeren Group Ltd. common shareholders was $11.8 million, compared to a net loss of $2 million in Q4 2023.
Impact of Foreign Exchange Losses
Long operational foreign exchange losses contributed to the increase in net loss.
Challenges with Project Delays
Project sales timing delays impacted Q4 revenue recognition; expected projects remain on track to close in the first half of 2025.
Company Guidance
During Emeren Group, Ltd.'s Fourth Quarter 2024 earnings call, the company provided comprehensive guidance for 2025, highlighting several key metrics. Emeren anticipates full-year revenue to range between $80 and $100 million, with a gross margin of 30% to 33%. The Independent Power Producer (IPP) segment is expected to generate $28 to $30 million in revenue, maintaining a robust 50% gross margin. The Development Services Agreement (DSA) segment is projected to contribute $35 to $45 million, with IPP and DSA collectively accounting for over 70% of total revenue. Emeren also outlined a strong contracted revenue base, including $84 million in DSA revenue with an additional $100 million under negotiation. For the first half of 2025, revenue is predicted to be between $30 and $35 million, sustaining a gross margin of 30% to 33%. The company expressed confidence in achieving positive operating cash flow in 2025, supported by a substantial pipeline of 4.3 gigawatts in advanced-stage storage and 2.4 gigawatts of solar PV projects.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.