Solar energy has become a key driver in the global shift toward sustainable power. It plays a crucial role in reducing greenhouse gas emissions, enhancing energy security, and fostering economic growth. By harnessing solar power, nations can reduce their reliance on fossil fuels, lowering their exposure to volatile energy markets. Moreover, with its low carbon footprint, solar energy is also a key solution for fighting climate change.
According to the International Energy Agency (IEA), declining costs have led to a surge in solar photovoltaic (PV) adoption. Over the past five years, global solar capacity has tripled. Between 2024 and 2030, solar PV is projected to drive 80% of the world’s renewable energy expansion, driven by large-scale solar farms and increased rooftop installations. By the end of the decade, solar is expected to surpass wind and hydropower as the dominant renewable energy source.
Solar Market Trends and Challenges
Wood Mackenzie’s 2025 solar market report, Solar: predictions for 2025, highlights that global installed capacity reached 495 GW in 2024, marking a 14% increase from the previous year. The rising demand for electricity, fuelled by data centers and electrification trends, continues to support this expansion. However, political shifts following the 2024 elections could introduce policy uncertainties, affecting renewable energy incentives. In mature markets, the reduction of financial support, such as feed-in tariffs and capital expenditure rebates, may slow growth after years of rapid acceleration.
Despite concerns over market saturation, a shift is taking place in 2025. Overcapacity in solar module manufacturing has led top producers to limit supply, with major polysilicon manufacturers reducing production and module makers setting price floors. This suggests the market could shift back in favor of suppliers.
Looking beyond short-term fluctuations, Deloitte’s 2025 Renewable Energy Industry Outlook expresses confidence in solar’s long-term trajectory. Their research found that solar was the only major energy source to record significant capacity growth, surging 88% to 18.6 GW. By the end of 2024, solar overtook hydropower and nuclear to become the fourth-largest source of installed capacity, trailing only wind, natural gas, and coal. The US Energy Information Administration (EIA) also projects record-breaking additions in 2024, with solar capacity expected to grow by 38.4 GW, far exceeding the 6.5 GW increase expected for wind power.
In summary, solar energy has become a key part of the global shift toward cleaner power. Its fast growth is fuelled by new technology, lower costs, and supportive policies. However, future progress will depend on addressing policy uncertainties and infrastructure challenges. With ongoing innovation and strong government support, solar energy is set to remain a major player in the clean energy transition. Keeping this in mind, let’s explore our top picks for the best solar stocks to buy in 2025.
An agricultural field full of solar panels, capturing the sun’s energy for the company.
Our Methodology
To identify the stocks, we began by compiling a list of solar companies with a market capitalization of at least $500 million. This was done using online stock screeners, solar-focused ETFs, and financial media reports. Next, we filtered the list to include only those stocks with an upside potential of at least 10%. From this refined selection, we identified the top 10 stocks with the highest hedge fund ownership, leveraging data from Insider Monkey’s Q4 2024 hedge fund database. Finally, we ranked these stocks in ascending order based on the number of hedge funds holding positions in them.
Note: All pricing data is as of market close on March 20.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Solar Stocks to Buy in 2025
10. JinkoSolar Holding Co. Ltd. (NYSE:JKS)
Upside Potential: 52%
Number of Hedge Fund Holders: 13
China-based JinkoSolar Holding Co. Ltd. (NYSE:JKS) ranks among the world’s leading solar module manufacturers, supported by an expansive global supply chain and a solid foothold in both residential and utility-scale solar markets. The company specializes in producing high-efficiency monocrystalline and bifacial modules, delivering innovative solutions designed to maximize energy generation.
Analysts have maintained a cautious view of the stock, largely due to the potential effect of proposed tariffs on solar panel imports, which could climb to as much as 200%. GLJ Research analyst Gordon Johnson, who has a Sell rating on the stock, noted that such tariffs could result in structural losses, particularly for the company’s new $1 billion Saudi Arabian plant intended to serve the U.S. market. The analyst also flagged concerns around declining profitability and oversupply issues in the solar cell sector.
Shares of JinkoSolar Holding Co. Ltd. (NYSE:JKS) have dropped nearly 11% year-to-date. Despite these challenges, the company benefits from a vertically integrated solar product value chain, encompassing everything from silicon wafer production to solar module manufacturing. This integration, coupled with cost leadership and technological advancements, has cemented the company’s role as a key player in the solar industry, especially as the global transition to clean energy accelerates. The company is set to announce its fourth-quarter 2024 financial results on March 26, which will be closely monitored for insights into its future outlook.
9. Canadian Solar Inc. (NASDAQ:CSIQ)
Upside Potential: 27%
Number of Hedge Fund Holders: 13
Canadian Solar Inc. (NASDAQ:CSIQ) is a fully integrated solar company that manufactures solar PV modules and develops large-scale solar and battery energy storage projects. Its diverse product offerings include high-efficiency solar panels, energy storage solutions, and engineering, procurement, and construction services.
The company anticipates substantial growth in electricity demand over the coming decades, driven by trends such as clean energy adoption in data centers, EVs, crypto mining, and rising industrial power needs. Global energy storage capacity is projected to grow at an annual rate of 32%, surpassing 1.0 Terawatt-hour (TWh) by 2027, positioning its subsidiary e-STORAGE as a key player.
To bolster its expansion, Canadian Solar Inc. (NASDAQ:CSIQ)’s subsidiary, Recurrent Energy, secured $183 million in funding for the Fort Duncan Storage project in Texas. This 200 MWh facility, set to launch by summer 2025, includes $112 million from Nord/LB and $71 million in tax equity from Greenprint Capital. Operating on a merchant basis, the project will supply stored energy to the ERCOT grid during peak demand, supporting up to 66,100 households for a two-hour cycle.
8. Daqo New Energy Corp. (NYSE:DQ)
Upside Potential: 30%
Number of Hedge Fund Holders: 19
Another China-based company, Daqo New Energy Corp. (NYSE:DQ), is a leading producer of high-purity polysilicon, a critical material used in the production of solar PV cells. The company supplies to major solar module manufacturers worldwide, playing a vital role in the solar value chain.
The company generates over 60% of its revenue by selling polysilicon products to major China-based photovoltaic manufacturers like JinkoSolar, Shuangliang, and Gokin Solar. In its Q4 2024 results announced on February 27, financial performance showed signs of stabilization, with quarterly revenue down just 2% from the prior quarter, reaching $195.4 million, and a gross loss of $65.3 million, compared to $60.6 million in Q3 2024. However, for FY 2024, revenue dropped significantly to $1.0 billion from $2.3 billion in 2023, accompanied by a gross loss of $213 million, a sharp contrast to the $921 million gross profit seen the previous year.
While Daqo New Energy Corp. (NYSE:DQ) stands to benefit long-term from global decarbonization goals and growing solar adoption, 2024 proved to be a difficult year due to excess capacity in the solar PV industry. This oversupply triggered significant price reductions across the value chain. In response, the company reduced production to mitigate losses, though it was insufficient to offset weaker demand and declining prices.
Despite these issues, on February 27, JP Morgan analyst Alan Hon maintained a Buy rating for Daqo with a price target of $28.5. Market sentiment remains generally positive, with a consensus 1-year median price target of $26, reflecting a potential 30% upside from current levels.
7. Array Technologies Inc. (NASDAQ:ARRY)
Upside Potential: 35%
Number of Hedge Fund Holders: 31
Array Technologies Inc. (NASDAQ:ARRY) is a manufacturer of solar tracking systems designed to improve the efficiency of utility-scale solar power plants. The company’s patented tracking technology, comprising software and hardware, enhances energy production by allowing solar panels to adjust their orientation based on sunlight conditions.
On March 7, a Guggenheim analyst upgraded Array Technologies Inc. (NASDAQ:ARRY) from Neutral to Buy, assigning a $10 price target. While Q4 results and the company’s 2025 outlook aligned with the analyst’s estimates, they fell short of consensus expectations for 2025. The analyst highlighted that the 2025 outlook might be more favourable than it initially appears, driven by the positive impact of lower steel prices on the company’s overall pricing. Additionally, although the $2 billion backlog outcome might have disappointed some investors, Brazil de-bookings posed a temporary challenge, with bookings expected to resurface later in the year following power purchase agreement renegotiations.
6. Shoals Technologies Group Inc. (NASDAQ:SHLS)
Upside Potential: 75%
Number of Hedge Fund Holders: 31
Shoals Technologies Group Inc. (NASDAQ:SHLS) focuses on providing electrical balance-of-system (EBOS) solutions for solar energy projects. Their offerings include critical components like combiner boxes, wiring solutions, and connectors, which are designed to improve the efficiency and reliability of solar installations. EBOS encompasses all the essential parts required to transfer the electric current generated by solar panels to an inverter and, eventually, to the power grid.
On February 26, Mizuho Securities analyst Maheep Mandloi reaffirmed a Buy rating with a $6 price target on Shoals Technologies Group (NASDAQ:SHLS), citing growth potential despite current challenges. The analyst noted that the company forecasted an 8% year-over-year revenue increase by 2025, slightly below earlier projections but within a promising range. Additionally, management aims for a long-term gross margin of 40-45% through cost reductions and automation. Along with this, growing bookings and 2025 capital expenditures are expected to boost productivity by 2026. That analyst also highlighted that despite competitive pressures impacting margins, the company’s transition to a Tennessee facility and strategic initiatives are expected to enhance future performance.
5. Clearway Energy Inc. (NYSE:CWEN)
Upside Potential: 17%
Number of Hedge Fund Holders: 32
Clearway Energy Inc. (NYSE:CWEN) is a leading renewable energy company focused on owning and operating a diversified portfolio of clean energy assets. The company primarily generates electricity from renewable sources, including wind and solar, while also maintaining a portfolio of natural gas-fired plants.
In FY 2024, Clearway Energy Inc. (NYSE:CWEN) posted an adjusted EBITDA of $1.15 billion and cash available for distribution (CAFD) of $425 million, exceeding its $395 million guidance. The company is actively developing 5 GW of projects to meet the rising energy demands of data centers, a key growth driver. Management remains confident in achieving its 2027 CAFD per share target of $2.40 to $2.60 and remains committed to long-term financial objectives beyond 2027, reinforcing a strong outlook for sustained growth.
In a report released on February 25, BofA Securities analyst Dimple Gosai maintained a Buy rating on Clearway Energy. Notably, in November, BofA Securities had initiated coverage on Clearway Energy Inc. (NYSE:CWEN) with a Buy rating and a $33 price target. In that report, BofA analysts had highlighted the company benefiting from its sponsor, Clearway Energy Group (CEG), which holds a 41.8% economic interest and has a 30GW project pipeline. This partnership enables a steady flow of project acquisitions, reducing risk and adding stability. The analysts estimated that just 3-4% of CEG’s pipeline needs to be operational annually to sustain growth, providing strong visibility into future expansion and strengthening Clearway Energy Inc. (NYSE:CWEN)’s strategic advantage amid sector volatility.
4. Sunrun Inc. (NASDAQ:RUN)
Upside Potential: 101%
Number of Hedge Fund Holders: 38
Sunrun Inc. (NASDAQ:RUN) is a residential solar energy company specializing in solar panel installations, home energy storage, and solar leasing solutions. The company’s business model engages in providing clean energy as a subscription service. It allows homeowners to access solar energy with little to no upfront cost, offering lease and power purchase agreements (PPAs) that drive widespread adoption.
Analysts have acknowledged the company’s solid performance despite a tough market environment. However, concerns persist regarding uncertainties in renewable energy policies, especially components of the Inflation Reduction Act (IRA) that could impact cash flow for residential installers. These challenges may affect the company’s performance in the near term leading to analyst concerns. For instance, Truist Securities analyst Jordan Levy recently lowered Sunrun Inc. (NASDAQ:RUN)’s price target from $12 to $9 while maintaining a Hold rating after reviewing its Q4 results.
However, on March 3, RBC Capital analyst Christopher Dendrinos reiterated a more positive stance on Sunrun. While he revised the price target for the company from $17 to $14, he maintained an Outperform rating. The analyst acknowledged the uncertainties and noted that despite a strong balance sheet offering flexibility to navigate an uncertain macro environment, reduced customer growth and cash generation outlooks are evident. However, based on the analyst’s adjusted valuation model, he suggested that in the current environment, Sunrun should be approached as a value play, focusing on its cash-generating potential.
3. Enphase Energy Inc. (NASDAQ:ENPH)
Upside Potential: 25%
Number of Hedge Fund Holders: 39
Enphase Energy Inc. (NASDAQ:ENPH) is an energy technology company, renowned for pioneering semiconductor-based microinverter technology that has transformed residential and commercial solar markets. The company offers products such as microinverters, home energy storage systems, and smart monitoring software, ensuring efficient and reliable solar power generation.
In Q4 2024, the company shipped 1.69 million microinverters and 6.7 megawatt hours of IQ Batteries. To date, it has delivered approximately 80 million microinverters, representing nearly 28 GW. The company demonstrated strong growth, with Q4 2024 revenue increasing 26% year-over-year to $382.7 million. With a 31% operating margin, its adjusted EPS surged over 170% year-over-year to $0.92.
Following the results, a Craig-Hallum analyst reduced Enphase Energy Inc. (NASDAQ:ENPH)’s price target from $123 to $101 while maintaining a Buy rating. The analyst noted that despite a mixed 2024, the company delivered a modest Q4 revenue beat, driven by gross margin strength and better-than-expected EBITDA/EPS. U.S. revenue showed steady growth, supported by stable demand in California and other markets. However, he also highlighted that European revenue declined quarter-over-quarter, facing challenges tied to country-specific factors as the company continues its early-stage geographic expansion.
2. Nextracker Inc. (NASDAQ:NXT)
Upside Potential: 23%
Number of Hedge Fund Holders: 41
Nextracker Inc. (NASDAQ:NXT) is a provider of solar tracker systems that optimize energy production for utility-scale solar farms. Its intelligent tracking solutions allow solar panels to follow the sun’s movement, maximizing energy output and improving project economics.
Supporting the company’s investment thesis, RBC Capital analyst Christopher Dendrinos initiated coverage on Nextracker Inc (NASDAQ:NXT) with an Outperform rating and a $55 price target, in a report on March 17. The analyst highlighted the company’s consistent operational improvements and structural enhancements that support cost efficiency. The company’s innovative product design reduces overall system costs, and its industry-leading software, TrueCapture, offers significant added value for customers. The analyst sees potential upside to FY 2026/2027 consensus estimates and argued that the company’s robust balance sheet and free cash flow opportunities justify a valuation premium over its peers.
1. First Solar Inc. (NASDAQ:FSLR)
Upside Potential: 94%
Number of Hedge Fund Holders: 65
At the top of our list is First Solar Inc. (NASDAQ:FSLR), which is a global provider of solar energy solutions, specializing in thin-film photovoltaic (PV) modules. Its proprietary cadmium telluride (CdTe) technology offers higher efficiency and cost benefits compared to traditional silicon-based panels. With a market capitalization of nearly $14 billion, it is one of the largest solar-focused companies.
By the end of 2024, First Solar achieved approximately 21 gigawatts (GW) of global nameplate manufacturing capacity, an increase of over 4 GW from 2023, driven by the new Alabama facility and optimized throughput in Ohio. The company is also building a $1.1 billion manufacturing facility in Louisiana, set to begin operations in the second half of 2025. This facility will boost total capacity to over 25 GW by 2026. For FY 2025, First Solar projects revenue between $5.3 billion and $5.8 billion, reflecting a 32% year-over-year growth.
However, despite steady Q4 2024 results, the company reported quality issues in some products, leading to increased warranty expenses, potentially reaching $100 million, which has raised concerns among analysts.
In light of the company’s 2025 outlook, a Barclays analyst factored that impact into his estimates and revised the price target for First Solar Inc. (NASDAQ:FSLR), reducing it from $273 to $236 while retaining an Overweight rating on the stock. According to the analyst, India’s operations are expected to achieve their full production capacity, whereas facilities in Malaysia and Vietnam are anticipated to fall short. Additionally, costs indirectly related to First Solar’s warranty issues are projected to increase the cost per watt sold beyond prior guidance for 2025. This, in turn, has led the analyst to lower gross margin forecasts.
While we acknowledge the potential of FSLR to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than FSLR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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