Canadian Solar (CSIQ) Up Over 30% After Selling Half Billion In Solar Projects

Canadian Solar (CSIQ) is still trying to find a bottom and today is a good start towards that with the stock up over 30% on news it has sold nine solar plants in Ontario with a combined capacity of 86MW to TransCanada Corporation for about $470 million. All of the projects are under a 20 year power purchase agreement with the Ontario Power Authority.  The purchase on each project will close once the plants begin commercial production and reach certain milestones which are expected in late 2012 or early 2013.  It should be noted that TransCanada also operates the largest wind farm in Canada and New England.

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"The addition of these solar projects allows us to expand and add to our diverse power generating portfolio where a third of the power we own, or have interests in, comes from alternative or renewable energy sources," said Russ Girling, TransCanada’s president and chief executive officer. "Upon close of this acquisition, this low-risk investment is expected to be immediately accretive to earnings and cash flow."

Technically, we may be seeing a bottom in shares of CSIQ.  The stock has been testing big support around the all time lows reached during the market crash in 2008/2009 and the volume levels look much better.  The stock is up over 30% this morning with heavy volume and currently clearing resistance of the 50 day moving average.  I like the potential reward vs the risk down here.

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