Renewable Energy Stocks to Invest In – The Future of Clean Energy
Renewable energy stocks have had quite the year so far already. With U.S. President Biden announcing his commitment to reducing greenhouse gas emissions and his investment in the clean energy sector, investors are piling into renewable energy investments.
In a statement released from the U.S Department of Energy, the agency noted that clean energy sources, such as solar power, are rapidly becoming the fastest-growing source of new electricity generation in the U.S.
Not only is it the fastest-growing energy source right now, but it’s also expected to accelerate as more funds are being invested into the technology. Furthermore, the installation processes are beginning to improve. Researchers are predicting that solar energy can generate over 40% of U.S. electricity by 2035, from 3% right now.
If you are looking to take part in the future of clean energy, keep reading this guide to discover the top renewable energy stocks to invest in today.
The Top Renewable Energy Stocks to Invest In Right Now
The renewable energy sector is one of the most exciting industries to be a part of right now. Investors are cashing in on the deal, with millions of dollars coming into the industry to impact growth and innovation.
The Invesco WilderHill Clean Energy ETF (NYSE: PBW) gives us a general sense as to how the clean energy stocks are performing as a whole. The fund is invested in publicly traded companies that are “engaged in the business of advancement of cleaner energy and conservation.”
The clean energy ETF climbed over 177% in the past five years. However, the company is taking a hit in 2022. Right now, the ETF is down nearly 18% so far this year. Although, with many of the green energy stocks trading at a discount compared to prior months, investors wonder, what are the best renewable energy stocks to own right now?
Best Renewable Energy Stocks to Buy
Enphase Energy (Nasdaq: ENPH)
- Revenue (2021): 1.38 billion
- Market cap: 39.2 billion
- P/E ratio (TTM): 206.7
Arguably, one of the most beloved stocks in the clean energy space is Enphase Energy. Enphase has also been one of the fastest-growing solar companies. This is thanks in part to a smart acquisition of SunPower’s (Nasdaq: SPWR) microinverter business.
The new addition allowed Enphase to remain competitive in the solar industry by lowering its prices and igniting new sales. After Solaredge introduced the new technology, the solar company began to grow its revenue quickly.
Since 2018, Enphase Energy’s revenue has more than doubled. In 2020, Enphase Energy’s revenue was nearly $775 million. Moreover, the company reported $1.38 billion in revenue for 2021. So, if the company’s revenue can continue growing at this rate, investors will continue to reap the rewards.
Brookfield Renewable (NYSE: BEPC)
- Revenue (2021): 3.36 billion
- Market cap: 7.3 billion
- P/E ratio (TTM): 17.7
The company operates several different types of renewable energy units, including Hydroelectric, Wind and Solar. With so many exciting projects in the works, investors have a lot to look forward to. In the company’s latest letter to unitholders, the company noted a strategic collaboration with Amazon (Nasdaq: AMZN) to partner with and develop new renewable energy projects.
With a clean balance sheet, expanding portfolio and an influx of investments, the company is well positioned to take advantage of the global shift to cleaner energy sources.
Plug Power (Nasdaq: PLUG)
- Revenue (2021): 502.3 million
- Market cap: 15.8 billion
- P/E ratio (TTM): N/A
Plug Power is another popular renewable energy stock that has investors looking forward to the future. The hydrogen fuel cell maker leads the market with $140 million in revenue in Q1 2022 and has ambitious plans on expanding in the near future.
By 2024, the fuel cell maker is on track to meet its goal of – $1.2B annual sales and $200M operating income.
Plug Power’s stock has been another clean energy name that experienced massive growth in share price in the past two years. However, Plug Power has since taken a step back and currently trading around $25.
Solaredge Technologies (Nasdaq: SEDG)
- Revenue (2021): 1.96 billion
- Market cap: 17.6 billion
- P/E ratio (TTM): 124.7
Solaredge Technologies is a popular solar energy stock based out of Israel that develops and sells advanced solar panels.
The solar company has experienced massive growth in the past five years as solar energy costs have plummeted and new incentives are being offered to individuals that switch. The stock is up around 1,065% in the last five years alone and looks to be ready for another run. But, with new competition entering the market, will Solaredge be able to continue its dominant growth?
Solaredge is the number one solar inverter company in terms of revenue. The company’s Q2 2022 financial results reported $727.8 million. With more incentive offerings to switch to solar energy and utility costs rising, Solaredge should be in a good position to cash in.
Investing In Renewable Energy Stocks
Each one of these renewable energy stocks above has experienced solid growth in the past year. As an investor, any of these companies have the potential to generate significant returns. Doing business in a hyper-growth industry like solar energy or hydrogen fuel cells, like these companies, allows them to accomplish something entirely new and innovative.
These innovations don’t only create excellent investing opportunities. In addition, they also improve the quality of life around us.
Will one of them become the next 10-bagger? The renewable energy sector is known for its explosive stock price setups. For example, companies like Tesla (Nasdaq: TSLA) and Solaredge show investors can make good returns with the latest innovations.
The demand for clean energy continues to grow. And these renewable energy stocks are well-positioned in their market to continue producing returns for investors. However, if you too are looking to profit from clean energy, make sure to do your research.
About Pete Johnson
Pete Johnson is an experienced financial writer and content creator who specializes in equity research and derivatives. He has over ten years of personal investing experience. Digging through 10-K forms and finding hidden gems is his favorite pastime. When Pete isn’t researching stocks or writing, you can find him enjoying the outdoors or working up a sweat exercising.