Track market-moving stories before they get noisy

On May 01, 2026, Canadian Solar Inc CSIQ shares rose 9.5% today, closing at $16.74. The stock has fluctuated significantly over the past year, with a 52-week range of $8.84 to $34.59.

GF Value™ verdict: Current price of $16.74 is 9.5% overvalued compared to a GF Value™ of $15.29.GF Score™ of 83/100 indicates a strong potential for long-term returns.Notable signal: No insider transactions reported in the last 3 months. Is CSIQ Overvalued or Undervalued? According to the GF Value™, Canadian Solar Inc's current price of $16.74 is considered to be 9.5% overvalued against its estimated fair value of $15.29. This overvaluation suggests a limited margin of safety for potential investors. The GF Valuation label indicates that CSIQ is fairly valued, which may imply that while there are no immediate bargains in the stock, investors should be cautious about entering at these levels due to the current price exceeding its intrinsic value.

GF Value™ is GuruFocus' proprietary measure of intrinsic value, calculated from historical trading multiples, past business growth, and future performance estimates. Being overvalued poses risks, particularly if market conditions shift or if the company's performance does not meet expectations. Investors might want to wait for a more attractive entry point or consider the inherent risks associated with investing at a price that surpasses the calculated fair value.

How Does CSIQ's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 92.5x 15.6x The current P/E ratio of 92.5x is significantly higher than its 5-year median P/E of 15.6x, indicating that the stock is trading well above its historical valuation. This analysis aligns with the GF Value™ verdict, suggesting that CSIQ is overvalued based on its historical performance metrics.

What Does CSIQ's GF Score™ Tell Us? Metric Rating GF Score™ 83 Financial Strength 3/10 Profitability 6/10 Growth 8/10 Valuation 9/10 Momentum 8/10 CSIQ's GF Score™ of 83/100 indicates a relatively strong position in terms of growth and valuation, suggesting good potential for long-term returns. However, the financial strength score of 3/10 highlights a significant weakness that could impact the company’s stability and risk profile. The strong growth rank of 8/10 shows that the company has good growth prospects, while a valuation rank of 9/10 indicates that despite the current overvaluation, there is recognition of its growth potential in the market.

What Are Insiders Doing with CSIQ Stock? There have been no reported insider transactions in the last three months for Canadian Solar Inc. This lack of activity could suggest that insiders are not currently confident in the stock's potential at its current price levels or simply indicate a period of stability where no significant buying or selling activity is warranted.

What This Means for Investors Based on the GF Value™ assessment, Canadian Solar Inc CSIQ is currently overvalued. The current price of $16.74 exceeds the estimated fair value of $15.29, indicating a potential risk for new investors entering the market at this time.

For the complete analysis, visit the Canadian Solar Inc CSIQ stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.

Frequently Asked Questions What is CSIQ's GF Score™?

CSIQ has a GF Score™ of 83/100, indicating a strong potential for long-term returns based on various financial metrics.

Is CSIQ overvalued or undervalued?

CSIQ is currently considered overvalued, with a GF Value™ of $15.29 compared to its current price of $16.74.

What is CSIQ's P/E ratio?

CSIQ's current P/E ratio is 92.5x, which is significantly higher than its 5-year median P/E of 15.6x, indicating that the stock is trading above its historical valuation levels.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

American solar installers have stopped doing business with China-backed U.S. production centers due to uncertainties about their products' eligibility for government subsidies

image credit: Bamboo Works

Key Takeaways: China-linked U.S. solar panel makers may be ineligible for U.S. subsidies aimed at supporting residential-based solar power, according to a Reuters report JinkoSolar is selling 75.1% of its U.S. plant in Florida to an American private equity company in an apparent attempt to keep its products eligible for subsidies As Donald Trump prepares to visit China later this week to meet with President Xi Jinping, U.S. protectionist measures against Chinese products are likely to be one of the top items on the agenda. An important part of that discussion could focus on solar energy products, not only ones produced in China but also ones made at Chinese-invested plants in the U.S.

The size of the stake sale is quite revealing, since legislation passed by the U.S. last year, with strong backing from the Trump administration, sharply cut subsidies for residential solar installations, and placed restrictions on subsidies that remained. One restriction prohibited subsidies for any installations using panels produced at factories that were more than 25% owned by Chinese companies.

"We believe this transaction provides the right ownership, management and strategic direction for this new venture to grow capacity and serve the growing demand for high performance U.S.-sourced renewable energy products," said JinkoSolar U.S. general manger Nigel Cockroft. The two sides added that following the deal, they plan to at least double capacity at the plant, currently at 2 GW annually, and also start producing energy storage systems.

Not surprisingly, China has criticized the restrictions, calling them discriminatory, according to the Reuters report, citing a spokesperson for the Chinese embassy in Washington.

Investors applauded the latest move by JinkoSolar, whose shares rose 5.3% on Friday after the announcement. The stock is up 30% over the last 52 weeks on hopes for a recovery for the embattled sector that has suffered for more than a year due to huge overcapacity built up over the last three years.

Signs for such a recovery look broadly positive, as the sector gains fresh momentum from the U.S. and Israeli war against Iran, which has sent oil prices to multi-year highs and underscored the need for more reliable energy sources. Even before that, solar module and panel prices were showing signs of stabilizing after more than a year of declines, as Chinese producers shut down older, more obsolete capacity under encouragement by Beijing.

Low value-added facilitiesWhile the sale of majority stakes of their U.S. plants may help Chinese companies avoid the restriction limiting their stakes to less than 25%, the reality remains that these plants are quite low tech and not really the kinds of facilities the Trump administration wants to attract. That's because the facilities are mostly involved in final module assembly, with most or all of their key components imported from China.

The U.S. tensions are also significant because other markets, most notably the EU and India, have expressed their own frustrations at China and have taken similar steps in the past.

These issues have been years in the making, and we doubt things will be solved overnight during Trump's visit to Beijing. But at least the leaders can exchange views directly to better understand the other side's concerns. China has already shown some willingness to consider the Western point of view with its recent cancellation of a yearslong policy that exempted Chinese solar manufacturers from paying some value-added tax for products they exported.

Meantime, JinkoSolar and its peers, despite the numerous headwinds they've faced over the last year, continue to show signs of a rebound.

While its massive losses and thin margins don't look too impressive on the surface, the trends look broadly positive for a recovery over the next year or two. Now, Beijing needs to work at the more macro level to create favorable conditions for its solar companies to export some of their expertise to reduce or eliminate some of the geopolitics that have plagued the industry over the last few years.

To subscribe to Bamboo Works weekly free newsletter, click here

Market News and Data brought to you by Benzinga APIs

© 2026 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

To add Benzinga News as your preferred source on Google, click here.

KITCHENER, ON, May 14, 2026 /PRNewswire/ -- Canadian Solar Inc. ("Canadian Solar" or the "Company") (NASDAQ: CSIQ) today announced financial results for the first quarter ended March 31, 2026. First Quarter Highlights Solar module shipments of 2.5 GW, above guidance of 2.2 GW to 2.4 GW.

Is SunPower Stock Ready to Lead the Solar Market?Canadian Solar NASDAQ: CSIQ reported first-quarter 2026 revenue at the high end of its forecast and a stronger-than-expected gross margin, helped by tariff refund accruals, while the company still posted a net loss amid higher operating costs, foreign exchange losses and tax expense accruals.

Executive Chairman and Chief Technology Officer Dr. Shawn Qu said the company “started the year with strong momentum,” recognizing revenue on 2.5 gigawatts of solar modules and 2.1 gigawatt-hours of energy storage solutions, both above guidance. Total revenue was $1.1 billion, while gross margin was 25.1%.

Get Canadian Solar alerts:

MarketBeat Week in Review – 5/22 - 5/26Canadian Solar recorded a net loss attributable to shareholders of $32 million, or $0.71 per diluted share. Qu said the quarter’s profitability was affected by elevated non-logistics operating expenses, foreign exchange losses and tax expenses tied to the tariff refund.

Qu said the solar downturn has lasted longer than expected, and that Canadian Solar has responded by focusing its module business on “key attractive markets” and reducing volumes in less profitable markets. He described the company’s approach as a “profit-first strategy.”

Leadership Transition Announced Solar Panel Demand Makes Canadian Solar a Buy-the-Dip OpportunityCanadian Solar also announced a leadership transition, with Colin Parkin taking over as chief executive officer. Parkin previously served as president of Canadian Solar and president of e-STORAGE.

Qu said the succession followed a long-term planning process approved unanimously by the board. Qu will remain executive chairman and chief technology officer, focusing on the company’s technology roadmap and long-term research and development strategy.

“Today, we are navigating a pivotal shift from volume-driven expansion to value-driven leadership,” Qu said.

U.S. Manufacturing Expansion Remains Central Parkin said U.S. manufacturing is the first pillar of Canadian Solar’s global strategy. The company’s solar cell factory in Jeffersonville, Indiana, produced its first trial heterojunction, or HJT, solar cell at the end of March. Parkin said the first phase has 2.1 gigawatts peak of nameplate capacity and is expected to ramp over the next two quarters.

The company is also expanding beyond its original U.S. solar cell capacity plan. Parkin said Canadian Solar expects to begin trial production for a second phase early next year, adding 4.2 gigawatts peak and bringing total U.S. solar cell nameplate capacity to 6.3 gigawatts peak.

Canadian Solar is also expanding its Mesquite, Texas, solar module factory. Parkin said the facility reached full ramp last year and is expected to double nameplate capacity to 10 gigawatts peak by the second half of this year, enabling the company to fulfill future U.S. volumes from the Texas site.

In the first quarter, the manufacturing segment generated $950 million in revenue and a gross margin of 29.1%. Parkin said the sequential gross margin increase was driven by healthy energy storage volumes and the tariff refund. The segment posted operating income of $127 million.

During the question-and-answer session, Qu said the company expects commercial operations from the U.S. cell facility “somewhere in July,” with the first modules using those cells potentially delivered to customers in August or September. He cautioned that producing HJT cells in the U.S. is a first for the industry and “not an easy task.”

Energy Storage Backlog Reaches $3.5 Billion Parkin said e-STORAGE shipped 2.6 gigawatt-hours of energy storage solutions during the quarter, including 500 megawatt-hours to internal and external projects under execution. Revenue was recognized on 2.1 gigawatt-hours.

The company said its internal production of lithium iron phosphate prismatic cells has become a competitive advantage, with a cost basis below the market price of third-party cells. Parkin said the company is expanding both battery cell and SolBank capacity at its integrated battery energy storage system and battery cell factory in Southeast Asia, with new production lines expected to come online in the first half of 2027.

As of May, Canadian Solar’s contracted e-STORAGE backlog totaled $3.5 billion, including 34 gigawatt-hours of operating projects under long-term service agreements.

Parkin said the company continues to pursue both front-of-the-meter and behind-the-meter data center applications. In response to an analyst question, he said Canadian Solar is “very engaged” on data center opportunities, though he said the company could not disclose the parties involved.

Recurrent Energy Posts Loss While Monetizing Assets Ismael Guerrero, chief executive officer of Recurrent Energy, said the project development subsidiary generated $139 million in first-quarter revenue, improving sequentially because of the sale of the Fort Duncan project. Guerrero called Fort Duncan the first standalone battery energy storage system project in the company’s portfolio financed with non-recourse project finance and without a capacity contract in place.

However, Recurrent Energy posted an operating loss of $60 million. Guerrero said relatively muted project sales and ongoing platform operating costs weighed on results. He added that monetizing operating and under-construction assets may create uneven profit-and-loss impacts in the near term, but said the strategy is necessary to reduce balance sheet leverage and recycle capital.

As of March 31, Recurrent Energy had secured interconnections for 7 gigawatts of solar and 14 gigawatt-hours of storage globally, excluding projects already in operation. Its total pipeline stood at 24 gigawatts of solar and 81 gigawatt-hours of energy storage. The company’s operations and maintenance platform had a contracted portfolio of 15 gigawatts, including 11.2 gigawatts already operational.

Second-Quarter Guidance Calls for Lower Margin Chief Financial Officer Xinbo Zhu said first-quarter gross margin was boosted by the accrual of tariff refunds, which contributed 860 basis points. He said that even excluding the one-time benefit, gross margin exceeded guidance because of strong storage volumes and a healthy geographic mix of solar module volumes.

Zhu said net cash used in operating activities was $209 million, mainly due to increased inventories tied to the U.S. solar and storage businesses. Canadian Solar ended the quarter with $1.9 billion in cash and $6.8 billion in total debt. Capital expenditures were $173 million in the first quarter, primarily for U.S. manufacturing, and the company expects full-year 2026 capital expenditures of about $1.3 billion.

For the second quarter, Parkin said Canadian Solar expects to recognize revenue on 3.1 gigawatts to 3.3 gigawatts of solar modules and deliver 2.8 gigawatt-hours to 3.2 gigawatt-hours of energy storage solutions. Total revenue is expected to range from $1.0 billion to $1.2 billion, with gross margin projected between 13% and 15%.

Parkin said the broader solar market remains complex, with price increases not yet fully offsetting upstream cost pressures. In storage, he said the company expects record volumes in the second half, though margins are expected to normalize and remain partly exposed to lithium carbonate price fluctuations.

Canadian Solar reiterated its U.S. full-year 2026 volume guidance of 6.5 gigawatts to 7 gigawatts of module shipments and 4.5 gigawatt-hours to 5.5 gigawatt-hours of energy storage shipments.

About Canadian Solar NASDAQ: CSIQCanadian Solar Inc NASDAQ: CSIQ is a global renewable energy company that specializes in the design, development and manufacturing of solar photovoltaic (PV) modules and system solutions. Founded in 2001 and headquartered in Guelph, Ontario, the company has grown to become one of the world's largest solar module suppliers. Canadian Solar offers a comprehensive portfolio of products, including mono- and multi-crystalline solar cells and modules, as well as advanced energy storage and system integration solutions tailored for residential, commercial and utility-scale applications.

In addition to manufacturing solar components, Canadian Solar provides end-to-end services encompassing project development, engineering, procurement and construction (EPC), as well as operations and maintenance.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

Should You Invest $1,000 in Canadian Solar Right Now?Before you consider Canadian Solar, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Canadian Solar wasn't on the list.

While Canadian Solar currently has a Reduce rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

MarketBeat just released its list of the 7 hottest IPOs expected to hit Wall Street in 2026. See which companies are preparing to go public and why investors are watching closely.

Get This Free Report

Key Takeaways Canadian Solar posted Q1 revenues of $1.08B, topping estimates despite lower solar module sales.CSIQ battery storage shipments jumped 142% year over year, while module shipments fell 64%.Canadian Solar began trial production at its Indiana HJT solar cell factory, targeting July 2026 launch. Canadian Solar, Inc. (CSIQ - Free Report) reported first-quarter 2026 adjusted loss of 71 cents per share, narrower than the Zacks Consensus Estimate of a loss of $1.06. The company posted a loss of 69 cents per share in the year-ago quarter.

CSIQ’s RevenuesRevenues amounted to $1.08 billion, which surpassed the Zacks Consensus Estimate of $0.95 billion by 13.8%. The top line declined 9.9% from the year-ago quarter’s figure of $1.2 billion.

This year-over-year decrease was due to lower sales of solar modules.

Operational Update of CSIQSolar module shipments in the quarter totaled 2.5 gigawatts (GW), down 64% year over year.

Total battery energy storage shipments totaled 2.1 GWh, up 142% year over year.

Canadian Solar’s gross margin was 25.1% compared with 11.7% in the first quarter of 2025. The increase in gross margin was primarily due to the recognition of IEEPA tariff refund benefits.

Total operating expenses were $198 million, up from $195.3 million in the first quarter of 2025.

The company commenced trial production at the flagship HJT solar cell factory in Jeffersonville, IN, marking a key milestone in U.S. domestic manufacturing, with commercial operation targeted to begin in July 2026.

Canadian Solar’s Financial UpdateAs of March 31, 2026, Canadian Solar’s cash and cash equivalents totaled $1.44 billion, compared with $1.37 billion as of Dec. 31, 2025.

Long-term borrowings as of March 31, 2026, were $3.54 billion, down from $3.62 billion as of Dec. 31, 2025.

CSIQ’s GuidanceFor the second quarter of 2026, Canadian Solar anticipates total revenues to be in the band of $1-$1.2 billion. The Zacks Consensus Estimate for sales is pegged at $1.76 billion, higher than the company’s guided range.

Gross margin is expected to be 13-15%. Total module shipments recognized as revenues are expected to be in the range of 3.1-3.3 GW. Total battery energy storage shipments in the second quarter are expected to be in the range of 2.8-3.2 GWh, including approximately 400 MWh to internal and external projects under execution.

The company reiterated its guidance of 6.5-7 GW of solar modules and 4.5-5.5 GWh of battery energy storage solutions for the U.S. market in 2026.

CSIQ’s Zacks RankCanadian Solar currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Recent Solar ReleasesFirst Solar, Inc. (FSLR - Free Report) reported first-quarter 2026 earnings of $3.22 per share, which beat the Zacks Consensus Estimate of $2.87 by 12.1%. The bottom line increased 65.1% from the prior-year quarter’s figure of $1.95.

First Solar’s first-quarter net sales were $1.04 billion, which missed the Zacks Consensus Estimate by 0.1%. However, the top line rose 23.6% from the year-ago quarter’s $0.84 billion.

Enphase Energy, Inc. (ENPH - Free Report) reported first-quarter 2026 adjusted earnings of 47 cents per share, which decreased 30.9% from 68 cents reported in the prior-year quarter. However, the bottom line topped the Zacks Consensus Estimate of 43 cents by 8.2%.

Enphase Energy’s first-quarter revenues of $282.9 million missed the Zacks Consensus Estimate of $284 million by 0.2%. The top line decreased 28.6% from the prior-year quarter’s reported figure of $356.1 million.

SolarEdge Technologies, Inc. (SEDG - Free Report) reported a first-quarter 2026 adjusted loss of 43 cents per share, wider than the Zacks Consensus Estimate of a loss of 23 cents. The bottom line improved from the prior-year quarter’s loss of $1.14 per share.

SEDG’s revenues of $310.5 million surpassed the Zacks Consensus Estimate of $303 million by 2.3%. The top line also increased 41.5% from the year-ago quarter’s $219.5 million.

© zstockphotos / iStock via Getty Images

Shares of SolarEdge Technologies (NASDAQ:SEDG | SEDG Price Prediction) are ripping higher in Friday’s midday session, with SEDG stock up 22% to $61.44. That extends Thursday’s surge into a powerful two-day run, with the one-week move now sitting at 49%.

Enphase Energy (NASDAQ:ENPH) is along for the ride, with ENPH stock up 11% to $53.25 and the one-week tally near 46%. The rooftop solar bid that ignited Thursday’s session isn’t fading. It’s compounding.

The kicker: this is happening with the 10-year Treasury yield at 4.46%, still elevated but not the kind of move that breaks residential financing math. The bid looks structural.

SolarEdge’s Margin Story Keeps Working SolarEdge’s Q1 2026 report on May 6 delivered revenue of $310.5 million, up 42% year over year (YoY) and ahead of consensus. Non-GAAP gross margin came in at 24%, marking the sixth consecutive quarter of margin expansion.

The bigger driver here is the forward guide. SolarEdge’s management called for $325 million to $355 million in Q2 2026 revenue with non-GAAP gross margin between 23% and 27%, and CEO Shuki Nir told investors SolarEdge expects to be “close to breakeven operating profitability” at the midpoint.

Nir asserted the company has “shifted decisively to offense” around the Nexis platform rollout and an AI data-center power roadmap. With short interest still heavy and SEDG stock down 72% over five years, a clean beat plus a profitability inflection is exactly the cocktail that forces covering.

Enphase Catches the Sympathy Bid Enphase isn’t reporting today, but the setup is supportive. The most recent Q4 2025 print on February 3 delivered non-GAAP EPS of $0.71 against a $0.58 estimate, with U.S. sell-through demand and IQ Batteries flagged as standouts.

ENPH stock now sports a forward P/E ratio of 17x against a market cap of $6.33 billion, with the one-month gain stretching to 65%. That’s the kind of move that could draw momentum traders into Enphase.

Utility-Scale Names Aren’t Joining the Party The divergence is the real tell. Canadian Solar (NASDAQ:CSIQ) is down 1% today to $17.58, extending its post-earnings slide after the Q1 report leaned on a $93 million one-time IEEPA tariff refund to flatter the gross margin line.

First Solar (NASDAQ:FSLR) is participating only modestly, up 2% to $235.75, with FSLR stock still down 10% year to date (YTD). Capital is rotating into residential power electronics rather than utility-scale modules.

What Could Break This Move Solar is notoriously volatile, and a two-day rip can reverse just as fast. SEDG stock now trades well above the consensus analyst target of $39.57, with the analyst board still skewed 21 Holds against just one Buy. That’s a setup where one cautious downgrade into the weekend could take the air out quickly.

Policy is the other watch item. The IRA as amended by the One Big Beautiful Bill Act of 2025, plus the looming Section 25D expiration, is pulling residential demand forward. Any headline that questions the runway, or a back-up in the 10-year past the 4.58% high from May 21, 2025, would test the thesis fast.

Keep an eye on whether SEDG stock holds above $60 into the close and whether sell-side desks push out fresh notes on Monday. Momentum traders own this tape right now, and the next analyst action will decide if the bid keeps compounding or finally takes a breather.

The U.S. solar market continues to benefit from strong demand driven by rising electricity consumption, AI-powered data center growth and corporate clean-energy goals, with the Solar Energy Industries Association projecting solar capacity to nearly triple by 2036. However, growth is being tempered by policy uncertainty following the OBBBA, tighter tax-credit timelines, supply-chain pressures and weaker residential solar economics resulting from changes such as California’s Net Billing Tariff, all of which are increasing project risks and slowing parts of the market. A few prominent companies that solar investors may want to monitor are First Solar (FSLR - Free Report) , Enphase Energy (ENPH - Free Report) and Canadian Solar (CSIQ - Free Report) .

About the Industry The Zacks Solar industry can be fundamentally categorized into two groups of companies. One is involved in designing and producing high-efficiency solar modules, panels and cells, while the other is engaged in installing grids and, in some cases, entire solar power systems. The industry also includes a handful of companies that manufacture inverters for solar power systems, which convert solar power from modules into electricity required by electric grids. Per a report from the U.S. Energy Information Administration (“EIA”), solar’s share of U.S. electricity generation will be 8% in 2026 and 9% in 2027. It remains the nation's dominant form of new generating capacity.

3 Trends Shaping the Future of the Solar Industry Strong Demand Supports Solar Market Growth: Utilities and businesses across the United States are accelerating their adoption of solar energy — particularly solar systems combined with battery storage — as they seek cleaner, more resilient and cost-effective power solutions. Rising electricity prices and growing decarbonization commitments are making solar increasingly attractive, while battery storage helps users maintain power reliability during grid disruptions and periods of peak demand. The U.S. solar market is experiencing rapid expansion due to an unprecedented increase in electricity demand from data centers. The rapid expansion of artificial intelligence and cloud computing has significantly increased electricity consumption, prompting major technology companies and hyperscalers to invest aggressively in utility-scale solar and energy-storage projects. These investments are intended not only to secure reliable grid capacity for future operations, but also to support ambitious corporate sustainability and net-zero commitments.

A report published in March 2026 by the Solar Energy Industries Association (“SEIA”) projects cumulative U.S. solar capacity to nearly triple from 279 GWdc installed at year-end 2025 to 769 GWdc by 2036, with average annual capacity additions exceeding 44 GWdc. The updated forecast represents an increase from the prior quarter’s outlook, reflecting a stronger near-term utility-scale project pipeline and continued growth in energy demand expectations.

Policy Uncertainty Slows the Momentum: Policy uncertainty at the federal level has emerged as a significant challenge for the U.S. solar sector after the enactment of the One Big Beautiful Bill Act (“OBBBA”). The law significantly reduced the eligibility window for key clean-energy tax incentives, requiring most solar and wind projects to either begin construction by July 2026 or enter service before the end of 2027 to qualify for federal tax credits. In addition, the legislation imposed more rigorous construction qualification rules along with stricter regulations tied to foreign sourcing and supply-chain compliance. These changes have heightened development, financing and execution risks across the industry. Many market participants believe the tighter deadlines could force delays, restructuring or even cancellation of projects that are still navigating permitting approvals or grid interconnection processes.

The SEIA report highlighted that the residential segment installed 4,647 MWdc of solar capacity in 2025, representing a 2% decline from 2024 levels. Although module shortages and delivery delays raised concerns late in the year, most installers secured sufficient equipment to complete projects. Demand also failed to meaningfully accelerate ahead of the Section 25D tax credit expiration, as the OBBBA provided too little time for companies to ramp up sales, customer acquisition and installations before the deadline.

Tariff Pressures Strain Solar Economics: The heightened U.S. tariffs on imported goods have been negatively impacting nearly all industries, and solar is no exception. As expected, these tariffs have increased manufacturing costs for solar companies, which were already grappling with raw material shortages due to global supply-chain challenges. State-level policy changes have added pressure to the residential solar market. For example, California’s transition to the Net Billing Tariff (“NBT”) significantly reduced the compensation homeowners receive for excess electricity exported to the grid, lowering the economic benefits of rooftop solar systems.

According to the SEIA report, the U.S. commercial solar segment grew 6% in 2025, reaching 2,345 MWdc of new installations, largely driven by the continued rollout of California projects approved under the more favorable NEM 2.0 policy. Despite the transition to the less attractive NBT system, over 70% of fourth-quarter installations were still NEM 2.0 projects. However, as the backlog gradually declines, the market is expected to slow in 2026 because projects developed under NBT generally offer lower customer savings and weaker economic returns.

Zacks Industry Rank Reflects Gloomy Outlook The Zacks Solar industry is housed within the broader Zacks Oils-Energy sector. It currently carries a Zacks Industry Rank #203, which places it in the bottom 17% of more than 245 Zacks industries.

The group’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates bleak near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

The industry’s position in the bottom 50% of the Zacks-ranked industries is due to a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts have lost confidence in this group’s earnings growth potential over the past few months. The industry’s bottom-line estimate for the current fiscal year has moved down 9.1% to $1.50 since Feb. 28.

Before we present a few solar stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.

Industry Beats Sector & S&P 500 The solar industry has outperformed both its sector and the Zacks S&P 500 composite over the past year. The stocks in this industry have collectively grown 71.4% over the past year, while the Oils-Energy sector rose 43.3%. The Zacks S&P 500 composite has surged 31% in the same time frame.

One-Year Price Performance

Industry's Current Valuation On the basis of the trailing 12-month EV/EBITDA, which is commonly used for valuing solar stocks, the industry is currently trading at 12.76X compared with the S&P 500’s 18.65X and the sector’s 7.03X.

Over the past five years, the industry has traded as high as 34.03X, as low as 4.44X and at the median of 13.12X.

EV-EBITDA Ratio (TTM)

3 Solar Stocks to Watch Canadian Solar: Based in Kitchener, Ontario, Canada, the company is one of the leading manufacturers of solar PV modules and a provider of solar energy and battery energy storage solutions. On May 14, 2026, CSIQ reported first-quarter results. Solar module shipments in the quarter totaled 2.5 GW, down 64% year over year. Total battery energy storage shipments amounted to 2.1 GWh, up 142% year over year. The company commenced trial production at the flagship HJT solar cell factory in Jeffersonville, IN, marking a milestone in U.S. domestic manufacturing, with commercial operation targeted to begin in July 2026.

The Zacks Consensus Estimate for Canadian Solar’s 2026 earnings per share (EPS) indicates an increase of 53.6% year over year. The consensus estimate for 2026 sales indicates an increase of 2.8% year over year. The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

Price & Consensus: CSIQ

Enphase Energy: Based in Fremont, CA, this company is a global energy technology company that delivers energy management technology for the solar industry. It designs, develops, manufactures and sells home energy solutions, which connect energy generation, energy storage and control and communications management on a single intelligent platform. On May 18, 2026, Enphase Energy, announced the launch of PowerMatch technology for IQ Battery 10C systems in the United States, including Puerto Rico, and for IQ Battery 5P systems across North America and select countries in Central America and the Caribbean. During the first quarter of 2026, ENPH shipped 1.39 million microinverters from Texas and South Carolina facilities.

The Zacks Consensus Estimate for Enphase Energy’s 2026 earnings has improved 2.91% over the past 60 days. The consensus estimate for 2027 EPS indicates an increase of 19.9% year over year. The stock currently carries a Zacks Rank of 3.

Price & Consensus: ENPH

First Solar: Based in Tempe, AZ, the company is a leading global provider of comprehensive PV solar energy solutions and specializes in designing, manufacturing, and selling solar electric power modules using a proprietary thin-film semiconductor technology. On April 30, 2026, FSLR reported first-quarter results. Net sales were $1.04 billion for the first quarter, a 24% increase year over year, driven primarily by an increase in the volume of modules sold to third parties. It reported contracted sales backlog of 47.9 GW as of March 31, 2026.

The Zacks Consensus Estimate for First Solar’s 2026 EPS indicates an improvement of 24.1% from the prior-year reported figure. The consensus estimate for 2027 EPS indicates an improvement of 36.2% year over year. The company currently carries a Zacks Rank of 3.

Price & Consensus: FSLR

Canadian Solar is rated Buy, driven by a booming e-STORAGE business with a record $3.5B contracted backlog. CSIQ's e-STORAGE revenue is set to accelerate, with shipment guidance raised to 4.5–5.5 GWh in FY2026 and strong growth projected through 2027. Consensus expects CSIQ to return to profitability in FY2027, with EPS reaching $0.98 and revenue growth of 25.76% YoY.

If you bought Invesco Solar ETF (NYSEARCA:TAN) on the last trading day of 2025 at about $49 and checked your account at Monday’s close, your shares were worth about $71, a gain of about 45% in roughly five months. A $10,000 position became about $14,480. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) over the same window returned about 11%. So TAN is beating the broad market by something like four-to-one year to date, and the gap widened again last week when the fund tacked on another roughly 8% in five sessions.

That is the kind of number that gets screenshotted. It is also the kind of number that needs a closer look, because the same fund five years ago traded at about $77. Over a half-decade, TAN is still down about 8%, while the S&P 500 returned roughly 80%. The 2026 run is a recovery off a bombed-out base, not a fresh leg up from all-time highs. That distinction matters for what comes next.

The Funeral That Never Quite Happened The framing that solar was "left for dead" in 2025 deserves a small correction. TAN actually finished 2025 up about 41%, climbing from about $35 in early January to about $49 by year-end. The deeper damage was 2022 through 2024, when rising rates ate into project financing economics and the threat of a Republican sweep had traders pricing in a partial unwind of the Inflation Reduction Act. A Yahoo Finance piece from October 2024 captured the mood: a potential Republican sweep could lead to the scaling back of Inflation Reduction Act funds, specifically residential and commercial green investment tax credits. By the time 2025 opened, solar was a sector that hedge funds had largely walked away from.

That setup, a hated sector with crushed multiples and a few real businesses inside the wrapper, is what produced the move. Over the past twelve months TAN has returned about 120% against SPY’s roughly 29%. The fund just put in a 20% month in May alone. Sentiment turned before the fundamentals fully did, which is usually how these things work.

What Actually Did the Work TAN tracks the MAC Global Solar Energy Index and holds roughly 40 solar energy companies, with the top 25 holdings comprising about 93% of the fund. The names doing the heavy lifting in 2026 are familiar to anyone who watched the sector get punished. First Solar, Enphase Energy, Nextpower, and Enlight Renewable Energy sit near the top of the book, and the bullish-to-somewhat-bullish coverage on First Solar in particular has been steady through the spring. A May 21 Barron’s piece by Doug Busch flagged the setup directly, with TAN carrying a 0.403 bullish ticker sentiment score in Alpha Vantage’s aggregation.

Underneath the price action there is a real demand story. The EIA’s May 2026 Short-Term Energy Outlook revised its utility-scale solar generation forecast for 2026 1.4% higher than the prior month, citing more solar generating capacity online at the beginning of the year than previously estimated. Residential electricity prices are running about 18.2 cents per kilowatthour in 2026, a roughly 5% increase from 2025, which improves the payback math on rooftop systems. Estimated net summer solar PV capacity from utility and small-scale facilities reached 216,249 megawatts as of March 2026, up from 209,304 megawatts in December 2025. Installations are accelerating into a tightening grid.

The policy backdrop also failed to deliver the disaster that was priced in. The IRA tax credits remained intact through the first half of 2026, and the residential and commercial tax credits that solar developers depend on are still flowing. That is the simplest way to explain the move. The sector was priced for the worst case, and the worst case did not arrive.

What You Are Buying At $71 Here is the honest part. A reader who saw the headline and is thinking about chasing the move is buying a fund that has already done a roughly 8% week and a 20% month, with shares down about 4% on Monday alone. The setup that produced 2026’s gains, namely deep pessimism, depressed valuations, and a policy bogeyman that never showed up, is no longer the setup in front of you. Solar in June 2026 is consensus-bullish. A Motley Fool piece from May 23 framed it neatly, arguing TAN provides higher growth potential in the renewable solar energy sector versus traditional fossil fuel ETFs. That is the kind of take that shows up after the easy money has been made, not before.

The indicators worth watching from here are concrete. First, the EIA’s monthly capacity additions, which tell you whether the installation pace is holding or rolling over. Second, the trajectory of residential electricity prices, because every penny of rate increase tightens the payback period for rooftop solar and helps Enphase’s microinverter unit economics. Third, the legislative calendar around the IRA, since any serious attempt to claw back tax credits would re-introduce the discount that 2025 priced in. Fourth, the Fed’s path on rates, because solar project finance is one of the most rate-sensitive parts of the energy capital stack, and the rate cuts feeding the 2026 rally are already partly in the price.

A fund that is up 50% in five months after five flat years is doing something real. It is also a fund where the easy disagreement has been resolved in the bulls’ favor, which means new buyers are paying for a recovery that has largely already happened. The thing to remember is that the 2026 move was about a hated sector getting re-rated, not about solar suddenly becoming a different business. The next 50% will have to come from earnings, not from sentiment, and that is a much harder ask.

On May 15, 2026, HubSpot Inc (HUBS) shares rose 8.1% to a current price of $197.08. This price movement comes in the context of a challenging year where the sto

For new and old investors, taking full advantage of the stock market and investing with confidence are common goals. Zacks Premium provides lots of different ways to do both.

The popular research service can help you become a smarter, more self-assured investor, giving you access to daily updates of the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research reports, and Premium stock screens.

Zacks Premium includes access to the Zacks Style Scores as well.

What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.

Each stock is given an alphabetic rating of A, B, C, D or F based on their value, growth, and momentum qualities. With this system, an A is better than a B, a B is better than a C, and so on, meaning the better the score, the better chance the stock will outperform.

The Style Scores are broken down into four categories:

Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.

Growth ScoreGrowth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.

Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.

VGM ScoreIf you want a combination of all three Style Scores, then the VGM Score will be your friend. It rates each stock on their combined weighted styles, helping you find the companies with the most attractive value, best growth forecast, and most promising momentum. It's also one of the best indicators to use with the Zacks Rank.

How Style Scores Work with the Zacks Rank The Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.

Investors can count on the Zacks Rank's success, with #1 (Strong Buy) stocks producing an unmatched +23.7% average annual return since 1988, more than double the S&P 500's performance. But the model rates a large number of stocks, and there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.

This totals more than 800 top-rated stocks, and it can be overwhelming to try and pick the best stocks for you and your portfolio.

That's where the Style Scores come in.

To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.

As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.

Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.

Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: HubSpot (HUBS - Free Report) Headquartered in Cambridge, MA, HubSpot Inc. provides inbound marketing and sales applications over the cloud. The software-as-a-service vendor helps businesses attract customers through search engine optimization, social media, blogging, website content management, marketing automation, email, CRM, analytics and reporting.

HUBS is a #2 (Buy) on the Zacks Rank, with a VGM Score of A.

Additionally, the company could be a top pick for growth investors. HUBS has a Growth Style Score of A, forecasting year-over-year earnings growth of 30.3% for the current fiscal year.

Two analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.20 to $12.64 per share. HUBS also boasts an average earnings surprise of +5%.

With a solid Zacks Rank and top-tier Growth and VGM Style Scores, HUBS should be on investors' short list.

CAMBRIDGE, Mass.--(BUSINESS WIRE)--HubSpot, Inc., the agentic customer platform for scaling businesses, announced today that Yamini Rangan, the Company's Chief Executive Officer, is scheduled to present at the Evercore TMT Global Conference in San Francisco, California on Wednesday, June 3 at 6:00 p.m. ET. All interested parties can access the webcast live on the Company's investor relations website at ir.hubspot.com. The Company will also host investor meetings on the same day. About HubSpot H.

FRAMINGHAM, Mass., May 21, 2026 (GLOBE NEWSWIRE) -- Definitive Healthcare (Nasdaq: DH), a provider of healthcare data and analytics, today announced several product enhancements designed to give organizations a clearer view of the healthcare ecosystem and help them act on critical market intelligence faster.

These updates include expanded medical claims coverage, a new integration for HubSpot, direct access to HCP data within Salesforce, and new AI search capabilities in key products. Together, they strengthen the company’s core data foundation and make insights easier to access in the systems teams use every day, helping customers move faster, focus on the right opportunities, and make more confident decisions across sales, marketing, product development, strategy, and more.

“Organizations don’t just need more data. They need a complete, connected view of the healthcare market and the ability to act on it confidently, and with precision,” said Tina Hannagan, chief commercial officer of Definitive Healthcare. “These updates reflect our continued investment in the breadth, depth, and accuracy of our data, as well as how seamlessly it fits into our customers’ everyday workflows.”

Product updates:

Atlas All-Payor Claims expansion
Definitive Healthcare has expanded its Atlas All-Payor Claims dataset with new data sources, increasing its coverage of healthcare activity across the care continuum. Along with more claims volume, Definitive Healthcare is also delivering enhanced diagnosis detail and payor information, enabling organizations to better understand care trends, map the patient journey, inform product development, and make more confident growth decisions.

When paired with Definitive Healthcare’s reference and affiliation dataset, these claims assets provide customers with comprehensive intelligence on the healthcare universe including provider behavior, providers’ affiliation and referral patterns, patient care, and the activities taking place within a facility.

Learn more about the claims dataset.

New integration for HubSpot 
HubSpot users can now access Definitive Healthcare’s reference, affiliation, financial, and clinical data directly within their HubSpot CRM, giving sales teams a detailed view of contacts and accounts. With rich healthcare insights at their fingertips, teams can sharpen targeting, prospect more efficiently, and connect with the right buyers faster.

“Working directly with Definitive Healthcare to integrate their data into our HubSpot environment not only saved time and money we had been spending on a third-party integrations partner, but also helped us to add new fields, enabling insights into organizational affiliations, new markets, and prospective pricing models,” said Andrea Weiss, vice president of marketing at Medisolv. “The DH team was great to work with and made the integration easy to set up.”

Learn more about the integration for HubSpot.

Access healthcare professional data in Salesforce 
Salesforce customers including those using Agentforce Health and Agentforce Life Sciences, can now access affiliated HCP data directly within Salesforce through DefinitiveConnect, Definitive Healthcare's native AgentExchange application, complementing existing data on facilities, health systems, and executives. Sales and marketing teams can now quickly find, segment, and engage physicians and other healthcare professionals based on affiliations, practice locations, and specialties, without the need for manual uploads or external research.

Enhanced matching and merging ensure cleaner, more reliable records, empowering teams to move beyond static lists to more precise, context-driven engagement strategies.

Learn more about DefinitiveConnect.

New AI search capabilities
Definitive Healthcare is also announcing new AI search capabilities for key products, beginning with Monocl ExpertInsight and then expanding into the View Suite. Teams across sales, marketing, strategy, and medical affairs will be able to interact with Definitive Healthcare data intuitively, using conversational queries to quickly identify relevant organizations, healthcare professionals, and scientific experts, while building more targeted lists with significantly less manual effort.

A more complete, connected foundation for healthcare intelligence
These enhancements reflect Definitive Healthcare’s broader strategic approach: building a comprehensive, 360-degree view of the healthcare ecosystem and delivering intelligence in ways that are immediately actionable.

This view spans the full continuum of care, from hospitals and integrated delivery networks to outpatient sites like physician groups, surgery centers, and imaging facilities, connecting the dots between organizations, decision-makers, and the physicians delivering care, as well as the patients they serve and the key opinion leaders influencing clinical practice. 

With a deeply curated, proprietary data foundation and flexible delivery across CRM systems, data platforms, and analytics environments, Definitive Healthcare helps organizations move from insight to action with greater speed and precision.

For more information, visit definitivehc.com. 

Additional Resources

Follow Salesforce on LinkedIn and XLearn more about the new AgentExchange hereFollow Definitive Healthcare on LinkedIn and XLearn more about Definitive Healthcare and Salesforce here Salesforce, Agentforce, AgentExchange, AppExchange, and others are among the trademarks of Salesforce, Inc.

About Definitive Healthcare

Definitive Healthcare is a data and analytics company focused on the business side of healthcare. The healthcare market is complex — our data makes it clearer. We cut through the noise to deliver the insights you need to make smarter, faster, more strategic decisions. Because when you succeed, healthcare gets better for everyone.

Media Contact:
Bethany Swackhamer
[email protected]

Investor Contact: 
Brian Denyeau
ICR for Definitive Healthcare
[email protected]
646-277-1251

HubSpot, Inc. (HUBS) Presents at Jefferies Software, Internet & AI Conference Transcript

On June 01, 2026, HubSpot Inc HUBS shares rose 18.8% today, reaching a current price of $262.20. This recent surge comes amid a broader context where the stock has fluctuated between a 52-week high of $611.00 and a low of $173.25.

GF Value™ verdict: Current price of $262.20 is 65.4% below GF Value™ of $758.38.GF Score™ of 67/100 indicates an above-average ranking among stocks.Notable signal: Financial strength rated 9/10, indicating a strong balance sheet. Is HUBS Overvalued or Undervalued? HubSpot Inc's current price of $262.20 is significantly below its GF Value™ estimate of $758.38, representing a 65.4% margin of safety for potential upside. This suggests that HUBS is undervalued based on GuruFocus' proprietary measure of intrinsic value, which is calculated from historical trading multiples, past business growth, and future performance estimates. The GF Valuation label indicates that HUBS is significantly undervalued, presenting a compelling opportunity for long-term investors.

Despite the attractive valuation, potential investors should remain cautious, as market volatility and broader economic conditions could impact the stock's performance. The stock's year-to-date decline of 34.7% and a 55.5% drop over the past year highlight the risks associated with investing in HUBS, particularly in a fluctuating market environment.

How Does HUBS's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 137.3x 340.9x Forward P/E 20.1x N/A The current P/E (TTM) of 137.3x is significantly below its 5-year median P/E of 340.9x, indicating that HUBS is trading at a much lower valuation compared to its historical levels. This analysis aligns with the GF Value™ verdict, reinforcing the notion that HUBS is undervalued at its current price.

What Does HUBS's GF Score™ Tell Us? Metric Rating GF Score™ 67 Financial Strength 9/10 Profitability 4/10 Growth 9/10 Valuation 2/10 Momentum 2/10 The GF Score™ of 67/100 reflects a robust financial position, particularly with a financial strength rating of 9/10 and a growth rank of 9/10, indicating strong growth potential. However, the relatively low ratings in profitability (4/10), valuation (2/10), and momentum (2/10) suggest areas of concern that investors should consider. Overall, the strongest area is financial strength, while the weakest points are valuation and momentum, which could affect short-term performance.

What Are Insiders Doing with HUBS Stock? In the last three months, insider activity has shown mixed signals, with insiders buying $2.6 million worth of stock while selling $6.2 million. This pattern may suggest a lack of confidence among insiders regarding the stock's immediate prospects, despite the recent positive price movement. The net selling may raise some red flags for potential investors, as it typically indicates that insiders may believe the stock is not undervalued at current levels.

What This Means for Investors Based on the GF Value™ assessment, HubSpot Inc HUBS is currently undervalued at a price of $262.20 compared to its intrinsic value of $758.38. While the significant undervaluation presents a potential opportunity, investors should remain cautious due to the mixed signals from insider activity and overall market conditions.

For the complete analysis, visit the HubSpot Inc HUBS stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.

Frequently Asked Questions What is HUBS's GF Score™?

HUBS's GF Score™ is 67/100, indicating an above-average ranking among stocks based on key aspects like financial strength and growth potential.

Is HUBS overvalued or undervalued?

HUBS is currently undervalued, with a GF Value™ of $758.38 compared to its current price of $262.20, suggesting significant upside potential.

What is HUBS's P/E ratio?

HUBS's P/E (TTM) ratio is 137.3x, which is 60% below its 5-year median P/E of 340.9x, indicating that the stock is trading at a much lower valuation compared to its historical levels.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

For much of the past year, the word "SaaSpocalypse" hung over the software sector like a storm cloud that refused to move on. The fear was understandable, based primarily on the assumption that artificial intelligence (AI) would render traditional software platforms obsolete, automating away the workflows that justified their subscription costs, and hollowing out the business models that had made SaaS investing so rewarding for so long. Few companies felt that fear more painfully than HubSpot Inc NYSE: HUBS, which just a few weeks ago had shed around 80% from its all-time high and was back trading at 2019 levels.

HubSpot Today

$186.69 -6.10 (-3.16%)

As of 06/11/2026 03:59 PM Eastern

This is a fair market value price provided by Massive. Learn more.

52-Week Range$173.25▼

$578.51P/E Ratio97.75

Price Target$311.00

But over the past fortnight, something has started to shift in the SaaS space, and it's gathering momentum. Shares of Snowflake Inc NYSE: SNOW are ripping higher after convincing investors in its earnings report last week that its AI positioning is a strength rather than a liability. ServiceNow Inc NYSE: NOW, another big software name that was uninvestable for most of the past year, has gained nearly 50% since the middle of May for many of the same reasons.

Get HubSpot alerts:

It’s clear that the market is beginning to separate the software companies that are working with AI from those being disrupted by it, and the rewards for landing on the right side of that divide have been significant. HubSpot, which has surged more than 50% from the multi-year low it set earlier this month, is increasingly looking like the next name to make that crossing. Let's jump in and see just how good an opportunity it could be.

The SaaSpocalypse Hit HubSpot Hard, But the Tide May Be TurningThe bear case for HubSpot rested on the idea that AI would make the company’s traditional seat-count pricing obsolete, enable customers to build their own version of HubSpot’s CRM tools at a fraction of the cost, and gradually erode the value proposition that had made it the platform of choice for tens of thousands of small and mid-sized businesses over previous years.

However, this narrative is starting to crack. HubSpot presented at the Jefferies Software, Internet, and AI Conference last week, and, having leaned heavily into its agentic AI positioning, the company drew a strong market response. The stock has jumped sharply in the days since, hitting its highest level since March. That kind of price action following an AI-focused conference appearance is a signal worth taking seriously.

The Earnings Story Gives the Recovery a Real FoundationWhat separates this sudden bounce from being a short-term hype-driven pop is the quality of the fundamental picture sitting underneath it. HubSpot’s most recent quarterly results, delivered in early May, were the strongest evidence yet that the SaaSpocalypse narrative had dragged the stock down to levels completely unjustified based on actual business performance.

Revenue grew 23% year over year, beating expectations by a meaningful margin. Operating margins expanded significantly. And crucially, HubSpot achieved GAAP profitability for the first time in its history, a milestone that reframes the conversation about what kind of company this actually is.

Management also raised full-year guidance and announced that it had hit its 2027 margin target a full year ahead of schedule. These aren’t exactly the metrics of a business being disrupted into irrelevance. They’re more like the metrics of a business re-finding its stride at exactly the moment the market had given up on it.

The AI Pivot Is Starting to LandThe big question that will determine where HubSpot goes from here is whether the market will lean into its AI story the way it has with Snowflake's and ServiceNow's. The evidence from the Jefferies conference and price action in the days since suggests that the process has already started.

The good news for those of us thinking about getting involved is that, even after a 50% surge from its lows, HubSpot is still trading at 2020 levels despite printing record quarterly revenue and possibly cracking the AI disruption narrative.

HubSpot, Inc. (HUBS) Price Chart for Friday, June, 12, 2026

The analyst community appears to agree. Barclays, Truist, Raymond James, and Goldman Sachs have all reiterated Buy or equivalent ratings last month, with fresh price targets ranging up to $382, implying around 30% in additional upside from current levels.

If the SaaS recovery that has already rewarded Snowflake and ServiceNow so generously continues to broaden, HubSpot's combination of recovering fundamentals, an emerging AI narrative, and still-depressed valuation gives it more room to run than almost any other name in the sector. The low may well be in, and the question now is how far this rebound could go.

Should You Invest $1,000 in HubSpot Right Now?Before you consider HubSpot, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and HubSpot wasn't on the list.

While HubSpot currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

Click the link to see MarketBeat's list of seven stocks and why their long-term outlooks are very promising.

Get This Free Report

It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.

Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.

It also includes access to the Zacks Style Scores.

What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.

Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.

The Style Scores are broken down into four categories:

Value ScoreFinding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to highlight the most attractive and discounted stocks.

Growth ScoreGrowth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.

Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.

VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.

How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.

It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.7% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.

But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.

That's where the Style Scores come in.

You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.

The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.

A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.

Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: HubSpot (HUBS - Free Report) Headquartered in Cambridge, MA, HubSpot Inc. provides inbound marketing and sales applications over the cloud. The software-as-a-service vendor helps businesses attract customers through search engine optimization, social media, blogging, website content management, marketing automation, email, CRM, analytics and reporting.

HUBS is a #3 (Hold) on the Zacks Rank, with a VGM Score of A.

Additionally, the company could be a top pick for growth investors. HUBS has a Growth Style Score of A, forecasting year-over-year earnings growth of 34.7% for the current fiscal year.

12 analysts revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $0.66 to $13.07 per share. HUBS boasts an average earnings surprise of +5%.

With a solid Zacks Rank and top-tier Growth and VGM Style Scores, HUBS should be on investors' short list.

Listen to the audio version of this article (generated by AI).

Two months ago, software stocks were in freefall. Today, they’re within striking distance of all-time highs. 

Same companies. Same AI threat. Completely different prices.

Something changed. The question worth asking — before you chase this rally — is what, exactly, that something was.

The SaaS Comeback Nobody Saw Coming — and What It Actually Means The iShares Expanded Tech-Software ETF (IGV)— the benchmark index for software stocks — just made an unexpected comeback.

Back in April, IGV was sitting nearly 40% below its all-time highs, in bear market territory. People began questioning if the entire sector had a future. And some of those questions were legitimate — more on that in a moment.

But then the rally began. IGV ripped 45% off its lows in a matter of weeks. It blew through its 50-, 100-, and 200-day moving averages like they weren’t even there. Today, it sits less than 10% off its all-time highs.

This type of reversal off the 200-week moving average has only happened a handful of times in the past 15 years. Each time — in late 2011, early 2016, and early 2023 — turned out to be generational buying opportunities.

Technically speaking, this rally looks like the real deal. Institutional money came back hard and fast. Positioning is no longer washed out. The macro backdrop — no recession, tariff de-escalation, the AI capital expenditure cycle running full steam — is supportive. 

For traders, fighting this tape in the near term is likely a losing game.

What the Rally Did Not Fix: The Three AI Waves Still Threatening SaaS Now, here’s the uncomfortable truth: the stock prices recovered. The fundamental risks did not.

For years, Wall Street loved the Software-as-a-Service business model. Businesses would pay per employee per month to access a software platform that managed some part of its operations — sales pipeline, expense reports, project timelines, creative assets. 

Recurring, predictable, high-margin revenue. 

AI is now dismantling that very business model that made these companies worth hundreds of billions in the first place.

The disruption is playing out in three distinct waves, each more threatening than the last:

Wave 1: The Point Solution Wipeout AI agents can now perform tasks without a SaaS subscription attached. Why pay $15 per employee per month when AI can now manage tasks for far less? The lowest-value software offerings are being hollowed out first, and the pace is accelerating.

Wave 2: The Pricing Compression Squeeze For mid-market horizontal platforms — i.e. project management, customer relationship management, collaboration tools — the threat is subtler but equally dangerous. AI is reducing the switching cost of leaving these platforms. 

If an AI agent can replicate much of what a software platform does at a fraction of the price, customers don’t necessarily churn immediately. But they start to negotiate. Renewal rates slip. Pricing power evaporates. 

These are low-multiple businesses masquerading in high-multiple clothing.

Wave 3: The Business Model Disruption Even the biggest, most entrenched platform companies — the ones with large enterprise relationships and genuine data moats — will survive. Though, to do so, they will have to transform from seat-based subscription businesses into consumption-based AI platforms. 

Usage-based pricing sounds modern and exciting. It is also inherently lower-margin and lower-multiple than the model Wall Street has been paying 30x revenue for. This is not a crisis. But it is a permanent structural reset.

Beta vs. Conviction: How to Tell Which Software Stocks Deserve the Rally IGV went up as a block. It will not come down that way. 

When macro sentiment flips — fear turns to greed, institutional money re-risks — it buys everything in a sector first and asks questions later. That is what happened with IGV. 

However, inside that ETF, there are companies with genuinely AI-native business models that will compound through this transition, and there are companies bouncing on pure beta that will re-test their lows the next time AI demonstrates its abilities.

The Compounders: SaaS Stocks That Benefit as AI Proliferates The names worth holding are those that make up the nervous system of the AI economy — the infrastructure, security, observability, and physical-world data. 

Palantir (PLTR), CrowdStrike (CRWD), Palo Alto Networks (PANW), Datadog (DDOG), Axon (AXON), Samsara (IOT): these businesses benefit directly from a world where more AI agents are running, more data is being processed, and more attack vectors need strong defense.

The Faders: SaaS Stocks Bouncing on Macro, Not Fundamentals Then there are the names worth fading on this bounce. And this is where the SaaSmageddon thesis bites hardest.

Broader SaaS incumbents — legacy CRM platforms, creative tool suites, HR and payroll software, project management tools — face a more complicated road. Some are investing aggressively in AI and may survive the transition. But many are bouncing on macro tailwinds rather than fundamental improvement, and their pricing power story is getting harder to tell with each AI capability improvement.

Workday (WDAY), HubSpot (HUBS), and Adobe (ADBE) each face acute pressure from the second and third waves — bouncing hard on macro tailwinds while their pricing power stories quietly erode.

One of the most ironic shorts in the market right now is UiPath (PATH) — a company whose entire business is automating workflows, now being disrupted by better automation. UiPath built its model on robotic process automation: software bots that mimic human clicks, keystrokes, and navigation across legacy enterprise systems. It charged enterprise customers handsomely to deploy and manage those bots. Now, AI agents can do the same work — and increasingly more — without the rigid rule-based scripting UiPath requires, at a fraction of the cost, and without a dedicated implementation team. The product that was the future of automation is being made obsolete by the next version of it. The robots are eating the robot-makers.

The Bottom Line: Own the Nervous System, Fade the Workflow In the near term, there is no reason to be aggressively bearish on software stocks. The technical setup is as good as it has been in years, institutional positioning supports continuation, and the macro backdrop is not fighting the tape. 

But looking out 12 to 24 months? The fundamental reckoning that the market postponed is still coming. Enterprise AI adoption data — renewal rates, churn patterns, pricing concessions — will start to surface in earnings calls over the next several quarters. And as that happens, the distinction between AI-native compounders and beta-driven bounces will become impossible to ignore.

Own the nervous system. Fade the workflow.

Software that becomes more valuable as AI proliferates — security, observability, data infrastructure, physical-world intelligence — deserves a permanent place in your portfolio. The rest deserves skepticism, regardless of how good the chart looks today.

One thing this rally made clear? The market doesn’t wait for permission.

When institutional money decided software was worth owning again, it came back all at once, in a matter of weeks, before most retail investors had time to react. 

The same thing will happen when OpenAI and Anthropic file their S-1s — except the repricing won’t be contained to one sector. It’ll ripple across the entire AI ecosystem simultaneously.

I’ve already mapped where I think that money lands first. Not the IPOs themselves — the companies underneath them that Wall Street will be forced to reprice the moment the filings go public.

Here’s the full picture — including the specific names I think move first.

The upcoming report from Bath & Body Works (BBWI - Free Report) is expected to reveal quarterly earnings of $0.29 per share, indicating a decline of 40.8% compared to the year-ago period. Analysts forecast revenues of $1.36 billion, representing a decline of 4.2% year over year.

The consensus EPS estimate for the quarter has been revised 3.8% higher over the last 30 days to the current level. This reflects how the analysts covering the stock have collectively reevaluated their initial estimates during this timeframe.

Before a company announces its earnings, it is essential to take into account any changes made to earnings estimates. This is a valuable factor in predicting the potential reactions of investors toward the stock. Empirical research has consistently shown a strong correlation between trends in earnings estimate revisions and the short-term price performance of a stock.

While investors typically rely on consensus earnings and revenue estimates to gauge how the business may have fared during the quarter, examining analysts' projections for some of the company's key metrics often helps gain a deeper insight.

Bearing this in mind, let's now explore the average estimates of specific Bath & Body Works metrics that are commonly monitored and projected by Wall Street analysts.

Analysts expect 'Geographic Net Sales- Stores - U.S. and Canada' to come in at $1.07 billion. The estimate indicates a year-over-year change of -4%.

The consensus among analysts is that 'Geographic Net Sales- International' will reach $68.08 million. The estimate indicates a change of +6.4% from the prior-year quarter.

The average prediction of analysts places 'Geographic Net Sales- Direct - U.S. and Canada' at $228.33 million. The estimate indicates a change of -8.7% from the prior-year quarter.

The consensus estimate for 'Total Company-Operated Stores - Total Bath & Body Works - Total - Stores (EOP)' stands at 1,931 . The estimate compares to the year-ago value of 1,900 .

Based on the collective assessment of analysts, 'Total Company-Operated Stores - Total Bath & Body Works - Canada - Stores (EOP)' should arrive at 113 . The estimate is in contrast to the year-ago figure of 113 .

Analysts predict that the 'Company-operated U.S. Store Data - Average Store Size (selling square feet)' will reach 2.85 million. Compared to the present estimate, the company reported 2.85 million in the same quarter last year.

According to the collective judgment of analysts, 'Company-operated U.S. Store Data - Total Selling Square Feet' should come in at 5.17 million. Compared to the current estimate, the company reported 5.08 million in the same quarter of the previous year.

The combined assessment of analysts suggests that 'Total Company-Operated Stores - Total Bath & Body Works - United States - Stores (EOP)' will likely reach 1,819 . The estimate is in contrast to the year-ago figure of 1,787 .

Analysts forecast 'Total Partner-Operated Stores - Total International - International - Stores (EOP)' to reach 549 . Compared to the current estimate, the company reported 489 in the same quarter of the previous year.

Analysts' assessment points toward 'Total Partner-Operated Stores - Total International - Total - Stores (EOP)' reaching 586 . The estimate compares to the year-ago value of 524 .

The collective assessment of analysts points to an estimated 'Total Partner-Operated Stores - Total International - International - Travel Retail - Stores (EOP)' of 37 . Compared to the current estimate, the company reported 35 in the same quarter of the previous year.

View all Key Company Metrics for Bath & Body Works here>>>

Bath & Body Works shares have witnessed a change of -17.8% in the past month, in contrast to the Zacks S&P 500 composite's +4.6% move. With a Zacks Rank #4 (Sell), BBWI is expected underperform the overall market performance in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .

Delivers Q1 net sales and adjusted earnings per share results above guidanceFirst quarter net sales of $1.4 billion, down 3%. Earnings per diluted share of $0.90; Adjusted earnings per diluted share of $0.32Reaffirms full-year 2026 guidance of net sales down 4.5% to down 2.5%, earnings per diluted share of $3.00 to $3.25; and adjusted earnings per diluted share of $2.40 to $2.65 Chief Financial Officer Eva Boratto to step down June 12; Company appoints interim CFO with active search in progress COLUMBUS, Ohio, May 27, 2026 (GLOBE NEWSWIRE) -- Bath & Body Works, Inc. (NYSE: BBWI) today reported first quarter 2026 results.

Daniel Heaf, chief executive officer of Bath & Body Works, commented, “Our first-quarter results exceeded guidance, but remain below the standard our brand is capable of delivering. That reality reinforces the urgency with which we are executing the Consumer First Formula. Our efforts to strengthen our hero categories, modernize the brand, and expand our reach are beginning to resonate with consumers, and we are encouraged by the early proof points we are seeing.”

“We believe that the foundation we are building will drive improved performance over time, with the impact expected to build through the balance of 2026 and more meaningfully into 2027, as we position the company to return to sustainable, durable growth.”

First Quarter 2026 Results

The company reported net sales of $1,378 million for the quarter ended May 2, 2026, a decrease of 3% compared to net sales of $1,424 million for the quarter ended May 3, 2025.

Earnings per diluted share were $0.90 for the first quarter of 2026, compared to $0.49 last year. First quarter operating income was $231 million compared to $209 million last year, and net income was $183 million compared to $105 million last year.

Reported first quarter 2026 results included an $88 million pre-tax gain ($66 million after tax), net of legal fees, related to favorable settlements of payment card interchange fee litigation, aggregate pre-tax costs of $8 million ($6 million after tax) associated with business transformation activities, an $8 million pre-tax loss ($6 million after tax) related to the extinguishment of outstanding debt, a $3 million pre-tax gain ($3 million after tax) related to the sale of a non-core asset and a $62 million tax benefit due to the resolution of certain tax matters. Excluding these items, adjusted earnings per diluted share for the first quarter of 2026 was $0.32, adjusted operating income was $151 million and adjusted net income was $65 million.

At the conclusion of this press release is a reconciliation of reported‐to‐adjusted results, including a description of the adjusted items.

2026 Guidance

The company is maintaining its full-year 2026 guidance of net sales to decline between 4.5% to 2.5% compared to $7,291 million in fiscal 2025. The company is also maintaining its full-year 2026 earnings per diluted share guidance of between $3.00 and $3.25 compared to $3.11 in fiscal 2025 and full-year 2026 adjusted earnings per diluted share guidance of between $2.40 and $2.65, compared to adjusted earnings per diluted share of $3.21 in 2025. There are no share repurchases or tariff refunds assumed in our outlook. In fiscal 2026, we expect to generate free cash flow of approximately $600 million.

For the second quarter of 2026, the company is forecasting net sales to decline between 5% to 3% compared to $1,549 million in the second quarter of 2025. Second quarter 2026 earnings per diluted share is expected to be between $0.20 and $0.25, compared to earnings per diluted share of $0.30 and adjusted earnings per diluted share of $0.37 in the second quarter of 2025.

At the conclusion of this press release is a reconciliation of our guidance-to-adjusted guidance, including a description of the adjusted items.

For a reconciliation of our reported GAAP to adjusted non-GAAP earnings per diluted share for fiscal 2025 and the second quarter of 2025, refer to our Annual Report on Form 10-K, filed with the SEC on March 12, 2026, and our Quarterly Report on Form 10-Q, filed with the SEC on August 28, 2025, respectively.

Chief Financial Officer Transition

Chief Financial Officer Eva Boratto will step down from her role effective June 12 to pursue another professional opportunity. The company has initiated a comprehensive search process, supported by a leading executive search firm, to identify its next Chief Financial Officer.

Tom Javitch has been appointed Interim Chief Financial Officer effective upon Boratto’s departure. Javitch has been with Bath & Body Works for more than 16 years and L Brands for 25 years. He has held a number of senior finance leadership roles across the organization, including Executive Vice President of Brand Finance of Bath & Body Works.

Daniel Heaf said, “We are grateful to Eva for her leadership and many contributions to Bath & Body Works during an important period for the company. We thank her for her partnership and wish her continued success in her next chapter. While we search for a successor, I’m confident in Tom Javitch’s interim leadership, deep understanding of Bath & Body Works and expertise across the business—from product to store operations to supply chain.”

Boratto said, “It has been a pleasure to serve on the leadership team at Bath & Body Works, and I would like to thank Daniel, my colleagues in the finance organization, the Board and all of our associates for the support during my time at this remarkable company. I leave with confidence in Daniel’s leadership and the strategy he has put in place, and I look forward to watching as Bath & Body Works continues to regain momentum in the marketplace.”  

Earnings Call and Additional Information

Bath & Body Works, Inc. will conduct its first quarter earnings call at 8:30 a.m. ET on May 27th. To listen, call 877-407-9219 (international dial-in number: 412-652-1274). For an audio replay, call 877-660-6853 (international replay number: 201-612-7415); access code 13760165 or log onto www.BBWInc.com. A slide presentation has been posted on the company’s Investor Relations website that summarizes certain information in the company‘s prepared remarks from the earnings call as well as some additional facts and figures regarding the company’s operating performance and guidance.

ABOUT BATH & BODY WORKS
Bath & Body Works is a global leader in personal care and home fragrance, driven by the belief that everybody deserves to feel good.

The brand’s beloved and iconic scents are expertly crafted for exceptional performance and a luxury fragrance experience. Formulated with thoughtfully chosen ingredients, Bath & Body Works’ body care products are available in multiple forms including fine fragrance mist, body cream, lotion, eau de parfum, body wash, hand soap, sanitizer and more. The brand’s famous 3-wick candles are made with rich, high quality fragrance oils layered throughout a premium soy wax base, for up to 45 hours of room-filling fragrance.

Consumers can shop Bath & Body Works anytime and anywhere they choose, from welcoming, in-store experiences at more than 1,900 stores in the U.S. and Canada, 500-plus international locations, online at bathandbodyworks.com and on Amazon.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

We caution that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this press release or made by our Company or our management involve risks and uncertainties and are subject to change based on various factors, many of which are beyond our control. Accordingly, our future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements. Words such as “estimate,” “project,” “plan,” “believe,” “expect,” “anticipate,” “intend,” “potential,” “target,” “goal” and any similar expressions may identify forward-looking statements. There are risks, uncertainties and other factors that in some cases have affected and, in the future, could affect our financial performance and actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements included in this report or otherwise made by the Company or our management. These factors can be found in Item 1A. Risk Factors in our 2025 Annual Report on Form 10-K and our subsequent filings.

We are not under any obligation and do not intend to make publicly available any update or other revisions to any of the forward-looking statements contained in this press release to reflect circumstances existing after the date of this press release or to reflect the occurrence of future events even if experience or future events make it clear that any expected results expressed or implied by those forward-looking statements will not be realized.

We announce material financial and operational information using our investor relations website, press releases, SEC filings and public conference calls and webcasts. Information about the Company, our business and our results of operations may also be announced by posts on our accounts on social media channels, including the following: Facebook, Instagram, X, LinkedIn, Pinterest, TikTok and YouTube.  The information that we post through these social media channels and on our website may be deemed material. As a result, we encourage investors, the media and others interested in the Company to monitor these social media channels in addition to following our investor relations website, press releases, SEC filings and public conference calls and webcasts. The list of social media channels we use may be updated from time to time on our investor relations website. 

For further information, please contact:

Bath & Body Works, Inc.:
Luke Long
[email protected]

Media Relations
Emmy Beach
[email protected]

BATH & BODY WORKS, INC.
First Quarter 2026 Total Sales (In millions):
  First Quarter  2026  2025 % ChangeStores - U.S. and Canada (a)$1,062 $1,110 (4.3%)Direct - U.S. and Canada 246  250 (1.5%)International and Other (b) 70  64 9.0%Total Bath & Body Works$1,378 $1,424 (3.2%)__________        (a) Results include fulfilled buy online pick up in store orders.(b) Results include royalties associated with franchised stores, as well as international and domestic wholesale sales.  Total Company-operated Stores:

 Stores     Stores 1/31/2026 Opened Closed 5/2/2026United States1,814 13 (17) 1,810Canada113 — —  113Total Bath & Body Works1,927 13 (17) 1,923          Total Partner-operated Stores:

 Stores     Stores 1/31/2026 Opened Closed 5/2/2026International536 8 (2) 542International - Travel Retail37 — —  37Total International (a)573 8 (2) 579__________        (a) Includes store locations only and does not include kiosks, shop-in-shops, gondola or beauty counter locations.  BATH & BODY WORKS, INC.CONSOLIDATED STATEMENTS OF INCOME(Unaudited)(In millions, except per share amounts)     First Quarter  2026   2025 Net Sales$1,378  $1,424 Costs of Goods Sold, Buying and Occupancy (791)  (778)Gross Profit 587   646 General, Administrative and Store Operating Expenses (356)  (437)Operating Income 231   209 Interest Expense (69)  (71)Other Income, Net 4   8 Income Before Income Taxes 166   146 Benefit (Provision) for Income Taxes 17   (41)Net Income$183  $105     Net Income per Diluted Share$0.90  $0.49     Weighted Average Diluted Shares Outstanding 202   215          BATH & BODY WORKS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)
(In millions)  May 2,
2026 May 3,
2025ASSETS   Current Assets:   Cash and Cash Equivalents$820  $636 Accounts Receivable, Net 98   103 Inventories 782   869 Easton Assets Held for Sale 81   97 Other 118   115 Total Current Assets 1,899   1,820 Property and Equipment, Net 1,106   1,111 Operating Lease Assets 974   970 Goodwill 628   628 Trade Name 165   165 Deferred Income Taxes 110   133 Other Assets 81   54 Total Assets$4,963  $4,881 LIABILITIES AND EQUITY (DEFICIT)   Current Liabilities:   Accounts Payable$557  $452 Accrued Expenses and Other 513   495 Current Operating Lease Liabilities 206   201 Income Taxes 101   146 Total Current Liabilities 1,377   1,294 Deferred Income Taxes 115   23 Long-term Debt 3,613   3,886 Long-term Operating Lease Liabilities 894   895 Other Long-term Liabilities 95   233 Total Equity (Deficit) (1,131)  (1,450)Total Liabilities and Equity (Deficit)$4,963  $4,881          BATH & BODY WORKS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In millions)  First Quarter  2026   2025 Operating Activities:   Net Income$183  $105 Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:   Depreciation of Long-lived Assets 61   64 Share-based Compensation Expense 8   10 Gain on Sale of Non-core Asset (3)  — Loss on Extinguishment of Debt 8   — Tax Benefit from Resolution of Certain Tax Matters (62)  — Changes in Assets and Liabilities:   Accounts Receivable 82   103 Inventories (83)  (134)Accounts Payable, Accrued Expenses and Other 34   14 Income Taxes Payable 29   34 Other Assets and Liabilities (13)  (8)Net Cash Provided by (Used for) Operating Activities 244   188     Investing Activities:   Capital Expenditures (49)  (37)Proceeds from Sale of Non-core Asset 8   — Other Investing Activities (1)  (2)Net Cash Used for Investing Activities (42)  (39)    Financing Activities:   Payments for Long-term Debt (289)  — Repurchases of Common Stock —   (136)Dividends Paid (40)  (43)Tax Payments related to Share-based Awards (3)  (4)Other Financing Activities (3)  (5)Net Cash Used for Financing Activities (335)  (188)    Effects of Exchange Rate Changes on Cash and Cash Equivalents —   1 Net Decrease in Cash and Cash Equivalents (133)  (38)Cash and Cash Equivalents, Beginning of Year 953   674 Cash and Cash Equivalents, End of Period$820  $636          BATH & BODY WORKS, INC.ADJUSTED FINANCIAL INFORMATION(Unaudited)(Dollars in millions, except per share amounts)     First Quarter  2026   2025Reconciliation of Reported Operating Income to Adjusted Operating IncomeReported Operating Income$231  $209Interchange Fee Settlements (88)  —Business Transformation Activities 8   —Adjusted Operating Income$151  $209    Reconciliation of Reported Net Income to Adjusted Net IncomeReported Net Income$183  $105Interchange Fee Settlements (88)  —Business Transformation Activities 8   —Loss on Extinguishment of Debt 8   —Gain on Sale of Non-core Asset (3)  —Tax Effect of Adjustments 19   —Tax Benefit from Resolution of Certain Tax Matters (62)  —Adjusted Net Income$65  $105    Reconciliation of Reported Net Income per Diluted Share to Adjusted Net Income per Diluted ShareReported Net Income per Diluted Share$0.90  $0.49Interchange Fee Settlements (0.43)  —Business Transformation Activities 0.04   —Loss on Extinguishment of Debt 0.04   —Gain on Sale of Non-core Asset (0.02)  —Tax Effect of Adjustments 0.09   —Tax Benefit from Resolution of Certain Tax Matters (0.31)  —Adjusted Net Income per Diluted Share$0.32  $0.49        See Notes to Adjusted Financial Information.

BATH & BODY WORKS, INC.FORECASTED ADJUSTED FINANCIAL INFORMATION(Unaudited)(In millions, except per share amounts)     Full-Year  2026 Reconciliation of Forecasted Net Income Per Diluted Share to Forecasted Adjusted Net Income per Diluted Share Low HighForecasted Net Income per Diluted Share$3.00  $3.25 Interchange Fee Settlements (0.43)  (0.43)Business Transformation Activities 0.04   0.04 Loss on Extinguishment of Debt 0.04   0.04 Gain on Sale of Non-core Asset (0.02)  (0.02)Tax Effect of Adjustments 0.09   0.09 Tax Benefit from Resolution of Certain Tax Matters (0.31)  (0.31)Forecasted Adjusted Net Income Per Diluted Share$2.40  $2.65        Full-YearReconciliation of Forecasted Net Cash Provided by Operating Activities to Forecasted Free Cash Flow  2026 Forecasted Net Cash Provided by Operating Activities  $870 Forecasted Capital Expenditures   (270)Forecasted Free Cash Flow  $600        See Notes to Adjusted Financial Information.

BATH & BODY WORKS, INC.
NOTES TO ADJUSTED FINANCIAL INFORMATION
(Unaudited)

The adjusted financial information should not be construed as an alternative to the results determined in accordance with generally accepted accounting principles. Further, the company’s definitions of adjusted income information may differ from similarly titled measures used by other companies. Management believes that the presentation of adjusted financial information provides additional information to investors to facilitate the comparison of past and present operations. While it is not possible to predict future results, management believes the adjusted financial information is useful for the assessment of the operations of the company because the adjusted items are not indicative of the company’s ongoing operations due to their size and nature. Additionally, management uses adjusted financial information as key performance measures for the purpose of evaluating performance internally. The adjusted financial information should be read in conjunction with the company’s historical financial statements and notes thereto contained in the company’s Quarterly Reports on Form 10-Q and Annual Report on Form 10-K.

The “Adjusted Financial Information” provided in the attached reflects the following non-GAAP financial measures:

Fiscal 2026

In the first quarter of 2026, adjusted results exclude the following:

An $88 million pre-tax gain ($66 million after tax), included as a reduction to General, Administrative and Store Operating Expenses, related to cash proceeds received, net of legal fees, for favorable settlements of payment card interchange fee litigation;Aggregate pre-tax costs of $8 million ($6 million after tax), primarily included in General, Administrative and Store Operating Expenses, resulting from business transformation activities in connection with the Consumer First Formula;An $8 million pre-tax loss ($6 million after tax), included in Other Income, Net, related to the repurchase and early extinguishment of outstanding debt;A $3 million pre-tax gain ($3 million after tax), included in Other Income, Net, related to the sale of a non-core asset; andA $62 million tax benefit associated with the resolution of certain tax matters.
Full-year 2026 Forecasted Adjusted Net Income per Diluted Share excludes the adjustments referenced above.

Fiscal 2025

There were no adjustments to results in the first quarter of 2025.

Forecasted Free Cash Flow

Our Forecasted Free Cash Flow is defined as Forecasted Net Cash Provided by Operating Activities less our Forecasted Capital Expenditures. Our Forecasted Free Cash Flow is a non-GAAP financial measure which we believe is useful to analyze our anticipated ability to generate cash. Our Forecasted Free Cash Flow calculation may not be comparable to similarly-titled measures reported by other companies. Our Forecasted Free Cash Flow should be evaluated in addition to, and not considered a substitute for, other GAAP financial measures.

Bath & Body Works (BBWI - Free Report) came out with quarterly earnings of $0.32 per share, beating the Zacks Consensus Estimate of $0.29 per share. This compares to earnings of $0.49 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of +10.80%. A quarter ago, it was expected that this owner of Victoria's Secret, Bath & Body Works and other chain stores would post earnings of $1.77 per share when it actually produced earnings of $2.05, delivering a surprise of +15.82%.

Over the last four quarters, the company has surpassed consensus EPS estimates two times.

Bath & Body Works, which belongs to the Zacks Retail - Miscellaneous industry, posted revenues of $1.38 billion for the quarter ended April 2026, surpassing the Zacks Consensus Estimate by 1.01%. This compares to year-ago revenues of $1.42 billion. The company has topped consensus revenue estimates two times over the last four quarters.

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.

Bath & Body Works shares have lost about 11.7% since the beginning of the year versus the S&P 500's gain of 9.8%.

What's Next for Bath & Body Works?While Bath & Body Works has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Bath & Body Works was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.22 on $1.49 billion in revenues for the coming quarter and $2.61 on $7.09 billion in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Retail - Miscellaneous is currently in the bottom 31% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

Another stock from the same industry, Build-A-Bear (BBW - Free Report) , has yet to report results for the quarter ended April 2026. The results are expected to be released on May 28.

This toy retailer is expected to post quarterly earnings of $0.76 per share in its upcoming report, which represents a year-over-year change of -35%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.

Build-A-Bear's revenues are expected to be $130.11 million, up 1.3% from the year-ago quarter.

Bath & Body Works, Inc. just reported its Q1, and the results came in ahead of expectations. The struggling personal-care retailer is in the midst of an operational turnaround in an effort to return the business to growth. Today's BBWI results show progress, though there is clearly still a journey ahead.

For the quarter ended April 2026, Bath & Body Works (BBWI - Free Report) reported revenue of $1.38 billion, down 3.2% over the same period last year. EPS came in at $0.32, compared to $0.49 in the year-ago quarter.

The reported revenue represents a surprise of +1.01% over the Zacks Consensus Estimate of $1.36 billion. With the consensus EPS estimate being $0.29, the EPS surprise was +10.8%.

While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.

Here is how Bath & Body Works performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Total Company-Operated Stores - Total Bath & Body Works - Total - Stores (EOP): 1,923 compared to the 1,931 average estimate based on four analysts.Total Company-Operated Stores - Total Bath & Body Works - United States - Stores (EOP): 1,810 versus the three-analyst average estimate of 1,819.Total Company-Operated Stores - Total Bath & Body Works - Canada - Stores (EOP): 113 versus the three-analyst average estimate of 113.Total Partner-Operated Stores - Total International - International - Travel Retail - Stores (EOP): 37 compared to the 37 average estimate based on two analysts.Total Partner-Operated Stores - Total International - Total - Stores (EOP): 579 compared to the 586 average estimate based on two analysts.Total Partner-Operated Stores - Total International - International - Stores (EOP): 542 versus the two-analyst average estimate of 549.Geographic Net Sales- Stores - U.S. and Canada: $1.06 billion compared to the $1.07 billion average estimate based on three analysts. The reported number represents a change of -4.3% year over year.Geographic Net Sales- International: $70 million versus $68.08 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +9.4% change.Geographic Net Sales- Direct - U.S. and Canada: $246 million compared to the $228.33 million average estimate based on three analysts. The reported number represents a change of -1.6% year over year.View all Key Company Metrics for Bath & Body Works here>>>

Shares of Bath & Body Works have returned -7.9% over the past month versus the Zacks S&P 500 composite's +5.1% change. The stock currently has a Zacks Rank #4 (Sell), indicating that it could underperform the broader market in the near term.

Bath & Body Works Inc (NYSE:BBWI) jumped 12.8% in Wednesday morning trading after the retailer posted first-quarter results above both its own guidance and Wall Street estimates, while reaffirming its full-year outlook, easing concerns about the trajectory of the business.

Adjusted EPS of $0.32 beat consensus of $0.29 and topped the guided range of $0.24 to $0.30. Net sales of $1.38 billion, down 3.2% year-over-year, came in ahead of the $1.36 billion consensus and the company's guided range of down 4% to 6%. Adjusted operating income of $151 million significantly topped estimates of $141 million.

The company reaffirmed full-year 2026 guidance for net sales down 4.5% to 2.5%, adjusted EPS of $2.40 to $2.65, and free cash flow of approximately $600 million.

For Q2, it guided net sales down 5% to 3% and adjusted EPS of $0.20 to $0.25, with the midpoint coming in ahead of the $0.21 consensus.

CEO Daniel Heaf said the results exceeded guidance but remained below the standard the brand is capable of delivering. "That reality reinforces the urgency with which we are executing the Consumer First Formula," he said. "Our efforts to strengthen our hero categories, modernize the brand, and expand our reach are beginning to resonate with consumers."

By segment, US and Canada store sales fell 4% year-over-year, international rose 9%, and e-commerce declined 2%.

Jefferies called the quarter a beat on both sales and earnings and said it would be listening on the call for updates on strategic initiatives, the $250 million cost savings plan, and early reads on the company's Amazon launch.

Bath & Body Works also said CFO Eva Boratto will step down on June 12 to pursue another opportunity. Tom Javitch, who has more than 16 years at the company, has been named interim CFO while a permanent search gets underway.

Shares of Bath & Body Works (BBWI +3.86%) rebounded on Wednesday after the purveyor of personal care and home fragrance products reported higher-than-expected profits.

Image source: Getty Images.

Strengthening the foundation Bath & Body Works' net sales declined 3% year over year to $1.4 billion in its fiscal first quarter, which ended on May 2.

The specialty retailer closed 17 underperforming company-operated stores in the U.S. during the quarter and opened 13 new locations. That brought its total company-operated store count to 1,923.

During the same time, Bath & Body Works opened eight partner-operated stores in international markets and closed two, bringing its total to 579.

Today's Change

(

3.86

%) $

0.70

Current Price

$

18.82

All told, Bath & Body Works generated $195 million in free cash flow, up from $151 million in the year-ago period.

"We are simplifying the business, removing unnecessary complexity, and reallocating resources toward the areas that most directly impact the consumer," CEO Daniel Heaf said during a conference call with analysts. "These efforts are helping fund investment in product innovation, brand relevance, and digital acceleration while maintaining a strong financial foundation."

Value territory Looking ahead, management reaffirmed its full-year free cash flow target of about $600 million in fiscal 2026.

"We believe that the foundation we are building will drive improved performance over time, with the impact expected to build through the balance of 2026 and more meaningfully into 2027, as we position the company to return to sustainable, durable growth," Heaf said.

Even after today's gains, if Bath & Body Works can return to growth, its current price to forecasted free cash flow of roughly 6.5 could prove to be a bargain.

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.