May
25, 2021
6 min read
This story originally appeared on StockMarket
Are These The Best Renewable Energy Stocks To Buy Right Now?
Given the current state of the world, renewable energy stocks are some of the most active stocks in the stock market this year. Naturally, this could be the case with global warming and climate change. If anything, the switch to clean energy is becoming more of a necessity each day. For this reason, the future of energy generation likely rests on renewable energy companies. That said, it should come as no surprise that some of the top renewable energy stocks have grown considerably throughout the past year.
Perhaps you think that traditional energy companies are just sitting idle without taking part in the green economy. Well, you would be glad to know that the old guards are also keeping up with the times. That is especially considering the growth potential with renewable energy, at least under the current administration. Perhaps, the biggest reason to believe in renewable energy is the trajectory in which costs are heading, and renewable energy costs are plummeting. If you are a long-term investor looking for value bets you may want to consider adding these top renewable energy stocks to your watchlist right now.
Top Renewable Energy Stocks To Watch Now
- Brookfield Renewable Partners (NYSE: BEP)
- NextEra Energy (NYSE: NEE)
- First Solar (NASDAQ: FSLR)
- Chevron (NYSE: CVX)
- SolarEdge Technologies (NASDAQ: SEDG)
Brookfield Renewable Partners
Brookfield is one of the world’s largest publicly traded renewable power platforms. The company’s portfolio has a pipeline of 23,000 MW of capacity. The company received renewed interest from investors this month after the Biden administration said it has a goal of creating 30 gigawatts of US offshore wind capacity by 2030. It also boasts nearly 6,000 generating facilities in North America, South America, Europe, and Asia. The company’s goal is to deliver long-term annualized total returns of 12% to 15%. The company is also a global leader in hydroelectric power, which comprises approximately 62% of its portfolio.
From its first-quarter results, revenue came in 2.9% lower to $1.02 billion. But the more important metric investors should not overlook is that its funds from operations grew 21% in the first quarter compared to the prior-year period.
Also, the company had invested or agreed to invest $1.6 billion of equity across a range of transactions. The company told investors that in the first quarter, it closed its first offshore wind investment. And investors seem to be delighted with the news. Considering all these, is BEP stock a top renewable energy stock to buy now?
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NextEra Energy
NextEra is another leading renewable energy company headquartered in Florida. The company owns Florida Power & Light Company, which is the largest rate-regulated electric utility in the U.S. It also owns a competitive energy subsidiary, NextEra Energy Resources, which is the world’s largest producer of solar and wind energy today. NEE stock has been trading sideways since the start of the year. However, this could be a buying opportunity for investors who believe in the long-term potential of clean energy.
NextEra Energy Resources is one of the company’s divisions that provides long-term, contract-based renewable power to others. The company claims it is the largest generator of solar and wind power in the world. This Florida utility is very much leading the charge in renewables and should be a major growth engine for years to come.
On top of that, the company along with OPAL Fuels announced plans to build Minnesota’s first renewable natural gas facility. In detail, this could produce over 6 million gas gallon equivalents of renewable natural gas per year. With these developments, would you consider investing in NEE stock now?
First Solar
First Solar is a manufacturer of solar panels and a provider of utility-scale PV power plants. It also provides support services that include finance, construction, maintenance, and end-of-life panel recycling. The company’s integrated power plant solutions deliver an economically attractive alternative to fossil-fuel electricity generation today. Although FSLR stock has been trading sideways lately, it has recently received price upgrades from Bank Of America and Citigroup.
Not long ago, the company also announced that its next-generation photovoltaic (PV) technology, Series 6 CuRe (Copper Replacement) has the industry’s lowest warranted degradation rate at 0.2% per year. This unprecedented degradation rate is up to 60% lower than conventional crystalline silicon products and ensures that the module will retain at least 92% of its original performance at the end of its 30-year warranty. With lockdowns being lifted and manufacturing capacity rising back to pre-pandemic levels, would now be a good time to include FSLR stock on your watchlist?
Chevron
I know what you’re thinking, Chevron Corporation isn’t exactly a renewable energy stock. But its recent partnership with Toyota Motor Corporation (NYSE: TM) to explore the production and commercialization of hydrogen is indeed a step in the right direction. Of course, commercializing the hydrogen economy is not something that could happen in the near term. Nevertheless, the company does have a few tricks up its sleeves. In early April, it announced a deal to supply Japan’s Hokkaido Gas Co., Ltd. with about a half-million tons of liquefied natural gas over a period of five years starting April 2022.
Many investors, including Warren Buffett, love CVX stock because it has a strong balance sheet and reasonable growth prospects. After all, we are talking about a company with a history of 140 years. And more importantly, it has an attractive dividend yield of more than 5%. Yet, the company has not been resting on its laurels. With its hydrogen initiatives to support the green economy, is CVX stock a good stock to invest in right now?
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SolarEdge Technologies
Another company that stands to benefit from the rise of solar energy is SolarEdge Technologies. The company designs and sells direct current optimized inverter systems for solar photovoltaic (PV) installations worldwide. The company’s optimized inverter system maximizes power generation at the individual PV module level while lowering the cost of energy produced by the entire solar PV system. The company’s stock price took a dive after reporting its first-quarter results, in which revenue fell 6% from the year-ago period to $405.5 million. This came after the company warned that higher shipping costs could hit margins going forward.
Obviously, SolarEdge is a dominant player in the power optimizer market. The installation of its components in a typical solar panel gives it access to valuable data about the system’s efficiency and status. This shows us that the company not only can monetize their power optimizer products but also have another stream of revenue from monitoring solutions.
In addition to residential solar, SolarEdge is also expanding its offerings in the commercial and utility segments to fuel growth. SolarEdge stock may have been beaten down, but it’s certainly not out of the map if you ask me. If anything, the recent dip in SEDG stock could allow long-term investors to accumulate the stock at a discount.