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12 Best Climate Change Stocks To Buy According To Hedge Funds

In this article, we will be taking a look at the 12 best climate change stocks to buy according to hedge funds. To skip our detailed analysis on climate change stocks and more, you can go directly to see the 5 Best Climate Change Stocks To Buy According To Hedge Funds.

If there’s one global crisis everyone is likely to have heard of by now, it’s climate change. The problem posed by this phenomenon is extremely complex, and its resolution requires significant changes in the way we go about our daily lives. With rising emissions of greenhouse gases trapping heat in the atmosphere, global temperatures have been on the climb, contributing to a range of geological problems. As a result, many economic and market implications have also begun to be contemplated. According to a report published by the CFA Institute in 2020, economic losses caused by climate change could be between $4 trillion and $20 trillion.

As a result, climate change stocks, or stocks promoting the use of clean energy, have become the newest popular commodity on the market. Stocks like NextEra Energy, Inc. (NYSE:NEE), Tesla, Inc. (NASDAQ:TSLA), and Clearway Energy, Inc. (NYSE:CWEN) are a few of the more renowned names on this list of stocks. These are also the stocks set to benefit immensely from the recently passed Inflation Reduction Act which aims to combat the climate crisis. The Act laid down that it aimed to build 950 million solar panels, 120,000 wind turbines, and 2,300 grid-scale battery plants by 2030 to promote the use of clean energy. Embarking on such large-scale projects over the coming few years is expected to greatly increase the business and revenues of major clean energy companies on the rise.

Another report published by the International Energy Agency in March 2021 went over the total returns from global markets portfolios over the preceding 10 years and five years, showing a comparison between returns from portfolios containing fossil fuel companies and renewable power companies. The total return for the former over the past 10 years came in at 59%, while for the latter, it came in at 422.7%. Over the preceding five years, the returns came in at 59.3% and 186.6%, respectively. This shows the relative profitability of climate change stocks in comparison to traditional energy stocks, especially in light of growing concerns relating to the climate crisis.

Let’s now take a look at the 12 best climate change stocks to buy according to hedge funds.

Our Methodology

We scanned the database of 920 hedge fund holdings maintained by Insider Monkey and picked the top 12 stocks (in terms of hedge fund popularity) that are engaged in the clean energy sector in various forms. There are electric vehicle manufacturers, companies engaged in the solar photovoltaic industry, and ordinary clean energy-producing companies listed below. They are ranked based on the number of hedge funds holding stakes in them, from the lowest to the highest number.

Best Climate Change Stocks To Buy According To Hedge Funds

12. FuelCell Energy, Inc. (NASDAQ:FCEL)

Number of Hedge Fund Holders: 12

FuelCell Energy, Inc. (NASDAQ:FCEL) is an electrical components and equipment company that designs, manufactures, and sells stationary fuel cell power plants for distributed baseload power generation. The company is based in Danbury, Connecticut.

On October 21, Canaccord’s George Gianarikas assumed coverage of FuelCell Energy, Inc. (NASDAQ:FCEL) with a Hold rating.

The recently passed Inflation Reduction Act is one that will significantly benefit FuelCell Energy, Inc. (NASDAQ:FCEL). Under this act, the US government is planning to allocate at least $370 billion over the next ten years to decarbonization initiatives. For FuelCell Energy, Inc. (NASDAQ:FCEL), the act is expected to bring in 30% to 50% in increased investments. In the third quarter, the company’s revenue was $43.10 million, up 60.8% compared to the year-ago quarter.

D E Shaw was the largest stakeholder in FuelCell Energy, Inc. (NASDAQ:FCEL) in the third quarter, holding 8.8 million shares worth $29.9 million. In total, 12 hedge funds were long the stock, with a total stake value of $57.1 million.

FuelCell Energy, Inc. (NASDAQ:FCEL), like NextEra Energy, Inc. (NYSE:NEE), Tesla, Inc. (NASDAQ:TSLA), and Clearway Energy, Inc. (NYSE:CWEN), is among the top clean energy stocks investors can consider today if they are looking to invest in climate change stocks.

11. ChargePoint Holdings, Inc. (NYSE:CHPT)

Number of Hedge Fund Holders: 13

ChargePoint Holdings, Inc. (NYSE:CHPT) is another electrical components and equipment company on our list. It provides electric vehicle charging networks and solutions in the US and internationally.

A Buy rating was reiterated on ChargePoint Holdings, Inc. (NYSE:CHPT) on November 7 by B. Riley’s Christopher Souther. The analyst also placed an $18 price target on the stock.

Investors and analysts remain optimistic about ChargePoint Holdings, Inc. (NYSE:CHPT) since sales for new vehicles have stayed robust in 2022. Reports from October show elevated demand for the company’s products at 0.5% sequentially and 8.4% year-over-year. ChargePoint Holdings, Inc. (NYSE:CHPT) also increased its charging point capacity by this October, when it was operating over 200,000 such ports in North America and 16 European Union countries. This was a 69.49% year-over-year increase in the company’s installed base of network ports.

There were 13 hedge funds long ChargePoint Holdings, Inc. (NYSE:CHPT) in the third quarter, and 17 hedge funds long the stock in the previous quarter. Their total stake values were $71.7 million and $22.8 million, respectively.

10. Brookfield Renewable Partners L.P. (NYSE:BEP)

Number of Hedge Fund Holders: 19

Brookfield Renewable Partners L.P. (NYSE:BEP) is a renewable electricity company owning a portfolio of renewable power generating facilities. The company operates primarily in North America, Colombia, Brazil, Europe, India, and China.

Sean Steuart, an analyst at TD Securities, resumed coverage of Brookfield Renewable Partners L.P. (NYSE:BEP) on October 18 with a Buy rating and a $41 price target.

Brookfield Renewable Partners L.P. (NYSE:BEP) is considered to be one of the most attractive investment options in the clean energy sector. The company delivered significantly positive results in the third quarter. Its funds from operations were $243 million of $0.38 per unit, representing a 15% increase from the year-ago quarter. Brookfield Renewable Partners L.P. (NYSE:BEP) also has a strong balance sheet showing 90% of its borrowings being project level non-recourse debt, with an average remaining term of 12 years.

Select Equity Group was the largest stakeholder in Brookfield Renewable Partners L.P. (NYSE:BEP) in the third quarter, holding 1.9 million shares worth $61.2 million. There were 19 hedge funds long the stock in total, with a total stake value of $161 million.

9. Canadian Solar Inc. (NASDAQ:CSIQ)

Number of Hedge Fund Holders: 22

Canadian Solar Inc. (NASDAQ:CSIQ) is an information technology company that designs, develops, and sells solar ingots, wafers, cells, modules, and other solar power and battery storage products. The company operates through its Canadian Solar Inc. (CSI) and Solar and Global Energy segments.

JPMorgan’s Mark Strouse holds a Neutral rating on Canadian Solar Inc. (NASDAQ:CSIQ) as of October 20. The analyst also placed a $42 price target on the stock.

Canadian Solar Inc. (NASDAQ:CSIQ) has a history of profitability and is currently trading under $40, making its valuation highly attractive for a renowned stock. As of this October, the company’s net income trailing three months stood at $144.88 million over the past five years. In the second quarter, Canadian Solar Inc.’s (NASDAQ:CSIQ) revenue from its CSI segment grew by 74% and gross profit grew by 161% year-over-year. The growth in its second segment stood at 97% year-over-year and 496% quarter-over-quarter.

Our hedge fund data shows 22 funds long Canadian Solar Inc. (NASDAQ:CSIQ) in the third quarter, and 13 hedge funds long the stock in the previous quarter. Their total stake values were $123.7 million and $54.2 million, respectively.

8. Clearway Energy, Inc. (NYSE:CWEN)

Number of Hedge Fund Holders: 25

Clearway Energy, Inc. (NYSE:CWEN) is a renewable electricity company operating in the US. It has about 5,000 net megawatts of installed wind and solar generation projects.

Julien Dumoulin-Smith at Bank of America holds a Neutral rating on Clearway Energy, Inc. (NYSE:CWEN) shares as of September 19, alongside a price target of $40.

The passing of the Inflation Reduction Act will benefit Clearway Energy, Inc. (NYSE:CWEN) in the near future as well. The IRA is expected to spur 40% more solar panel installations over the next ten years, meaning the number of projects for Clearway Energy, Inc. (NYSE:CWEN) to take will significantly increase. The company has also mentioned that it intends to raise its dividend at the upper end of its target of 5-8% per year through 2026.

Out of 920 hedge funds tracked in the third quarter, 25 hedge funds were long Clearway Energy, Inc. (NYSE:CWEN), with a total stake value of $159.6 million. Renaissance Technologies was the largest stakeholder in the company, holding 1.1 million shares worth $30.6 million.

ClearBridge Investments, an investment management firm, mentioned Clearway Energy, Inc. (NYSE:CWEN) in its fourth-quarter 2021 investor letter. Here’s what the firm said:

Clearway Energy primarily owns and operates contracted renewable generation assets. It also owns and operates conventional generation and thermal infrastructure assets. Clearway Energy’s share price continued to benefit from the completed sale of its thermal assets, which was above expectations, generating USD$1.3 billion in incremental proceeds. Additionally, there was optimism surrounding a stimulus bill passthrough which contains renewables subsidies.”

7. Plug Power, Inc. (NASDAQ:PLUG)

Number of Hedge Fund Holders: 32

Plug Power, Inc. (NASDAQ:PLUG) is an electrical components and equipment company delivering end-to-end clean hydrogen and zero-emissions fuel cell solutions. The company is based in Latham, New York.

A Buy rating was reiterated on Plug Power, Inc. (NASDAQ:PLUG) on November 10 by analyst P.J. Juvekar at Citigroup. The analyst also placed a $20 price target on the stock.

At its Plug Power Symposium this year, Plug Power, Inc. (NASDAQ:PLUG) management expressed their confidence in achieving their growth targets of $5 billion in 2026 and $20 billion in 2030. The company expects a continued growth rate of 50% annually, yielding growth of over 5x from today. Management also raised their growth guidance for 2025 from $3 billion by 10%, bringing them up to 15%.

In total, 32 hedge funds were long Plug Power, Inc. (NASDAQ:PLUG) in the third quarter, with a total stake value of $373.5 million. In comparison, 26 hedge funds were long the stock in the previous quarter, with a total stake value of $258.9 million.

6. SolarEdge Technologies, Inc. (NASDAQ:SEDG)

Number of Hedge Fund Holders: 44

SolarEdge Technologies, Inc. (NASDAQ:SEDG) is an information technology company that develops direct current optimized inverter systems for solar photovoltaic installations. The company is based in Herzliya, Israel.

Ameet Thakkar at BMO Capital raised the price target on SolarEdge Technologies, Inc. (NASDAQ:SEDG) from $316 to $355 on November 18. The analyst also reiterated an Outperform rating on the stock.

SolarEdge Technologies, Inc. (NASDAQ:SEDG) is seen benefitting from strong momentum in Europe, according to its third-quarter results. The company’s $836.6 million revenue in the quarter was up by 59% from the same period last year. It shipped about 265,000 inverters, also showcasing an increase in shipments from the 228,400 figure reported in the second quarter.

SolarEdge Technologies, Inc. (NASDAQ:SEDG) was found among the 13F holdings of 44 hedge funds in the third quarter, with a total stake value of $673.7 million. Impax Asset Management was the largest stakeholder in the company, holding 547,646 shares worth $126.2 million.

SolarEdge Technologies, Inc. (NASDAQ:SEDG), like NextEra Energy, Inc. (NYSE:NEE), Tesla, Inc. (NASDAQ:TSLA), and Clearway Energy, Inc. (NYSE:CWEN), is a climate change stock many elite hedge funds are piling into today.

Click to continue reading and see the 5 Best Climate Change Stocks To Buy According To Hedge Funds.

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Disclosure: None. 12 Best Climate Change Stocks To Buy According To Hedge Funds is originally published on Insider Monkey.

AI, Tariffs, Nuclear Power: One Undervalued Stock Connects ALL the Dots (Before It Explodes!)

Artificial intelligence is the greatest investment opportunity of our lifetime. The time to invest in groundbreaking AI is now, and this stock is a steal!

AI is eating the world—and the machines behind it are ravenous.

Each ChatGPT query, each model update, each robotic breakthrough consumes massive amounts of energy. In fact, AI is already pushing global power grids to the brink.

Wall Street is pouring hundreds of billions into artificial intelligence—training smarter chatbots, automating industries, and building the digital future. But there’s one urgent question few are asking:

Where will all of that energy come from?

AI is the most electricity-hungry technology ever invented. Each data center powering large language models like ChatGPT consumes as much energy as a small city. And it’s about to get worse.

Even Sam Altman, the founder of OpenAI, issued a stark warning:

“The future of AI depends on an energy breakthrough.”

Elon Musk was even more blunt:

“AI will run out of electricity by next year.”

As the world chases faster, smarter machines, a hidden crisis is emerging behind the scenes. Power grids are strained. Electricity prices are rising. Utilities are scrambling to expand capacity.

And that’s where the real opportunity lies…

One little-known company—almost entirely overlooked by most AI investors—could be the ultimate backdoor play. It’s not a chipmaker. It’s not a cloud platform. But it might be the most important AI stock in the US owns critical energy infrastructure assets positioned to feed the coming AI energy spike.

As demand from AI data centers explodes, this company is gearing up to profit from the most valuable commodity in the digital age: electricity.

The “Toll Booth” Operator of the AI Energy Boom

  • It owns critical nuclear energy infrastructure assets, positioning it at the heart of America’s next-generation power strategy.
  • It’s one of the only global companies capable of executing large-scale, complex EPC (engineering, procurement, and construction) projects across oil, gas, renewable fuels, and industrial infrastructure.
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Wall Street is noticing this company also because it is quietly riding all of these tailwinds—without the sky-high valuation.

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This company is completely debt-free.

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The Hedge Fund Secret That’s Starting to Leak Out

This stock is so off-the-radar, so absurdly undervalued, that some of the most secretive hedge fund managers in the world have begun pitching it at closed-door investment summits.

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  • The AI infrastructure supercycle
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A New Dawn is Coming to U.S. Stocks

I work for one of the largest independent financial publishers in the world – representing over 1 million people in 148 countries.

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Should I put my money in Artificial Intelligence?

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Click to continue reading…