5 Best Green Stocks To Invest In 2023

In this article, we discuss the 5 best green stocks to invest in 2023. To go through our detailed analysis of the renewable energy sector and the green movement, go directly to the 11 Best Green Stocks To Invest In 2023.

5. First Solar, Inc. (NASDAQ:FSLR)

Number of Hedge Fund Holders: 50

First Solar, Inc. (NASDAQ:FSLR) is a U.S.-based company specializing in the manufacturing of solar panels and offering utility-scale PV power plants. The company provides a range of services, encompassing finance, construction, maintenance, and end-of-life panel recycling for comprehensive solar solutions.

On September 21, First Solar, Inc. (NASDAQ:FSLR) initiated the construction of its fifth fully vertically integrated manufacturing facility within the United States. This facility, located in Louisiana, represents an investment of around $1.1 billion. Upon completion, the facility is expected to augment First Solar, Inc. (NASDAQ:FSLR)’s global manufacturing capacity by 3.5 GW and is projected to commence commercial shipments by 2026.

According to Insider Monkey’s second quarter database, 50 hedge funds were bullish on First Solar, Inc. (NASDAQ:FSLR), compared to 39 hedge funds in the last quarter. Robert Pohly’s Samlyn Capital held a significant position in the company, with 1.26 million shares valued at $239.5 million.

4. PG&E Corporation (NYSE:PCG)

Number of Hedge Fund Holders: 51

PG&E Corporation (NYSE:PCG), also recognized as Pacific Gas and Electric Company, operates as a utility company based in California. The company supplies electricity to a vast customer base exceeding 5 million in California. Its electricity generation methods encompass natural gas, solar plants, hydropower, and nuclear energy.

On October 12, PG&E introduced its Microgrid Incentive Program (MIP), an innovative project designed to provide financial assistance for multi-customer microgrids proposed by community, local, and tribal governments. The MIP, a competitive grant program spanning the state and endowed with a $200 million budget, aims to accelerate the establishment of clean-energy community microgrids within disadvantaged and vulnerable communities throughout California.

On August 7, UBS analyst Gregg Orrill elevated PG&E Corporation (NYSE:PCG)’s stock rating from Neutral to Buy, concurrently raising the company’s price target to $21 from $19. This adjustment was based on Orrill’s assessment that PG&E Corporation (NYSE:PCG) has notably reduced the wildfire risk associated with its equipment by approximately 90% since the years 2017-18.

In Q2 2023, PG&E Corporation (NYSE:PCG)’s stock was owned by 51 hedge funds. Dan Loeb’s Third Point Management was the most prominent stakeholder in the company with 54 million shares worth $933.120 million.

Third Point Management made the following comment about PG&E Corporation (NYSE:PCG) in its Q1 2023 investor letter:

“Our strategy is to preserve liquidity and buying power to take advantage of markets when they “break”. While overall indices remain elevated, we are finding more chances to provide liquidity across all three asset classes in which we invest – credit, structured credit, and equity – opportunities which have been key drivers of performance for the fund. Our portfolio is balanced across industries with a focus on event-driven names including companies involved in spin-offs, significant cost-cutting, or other types of under-appreciated business transformation. PG&E Corporation (NYSE:PCG), which is still our largest position, continues to deliver strong performance, down 50bps in the first quarter but up 6.2% for the year to date after the Fire Victims Trust sold another 60 million shares in a block trade.”

3. NextEra Energy, Inc. (NYSE:NEE)

Number of Hedge Fund Holders: 59

NextEra Energy, Inc. (NYSE:NEE) stands as a prominent figure in the realm of green energy worldwide. With an impressive 67 gigawatts of generation capacity, a significant portion hails from renewable sources. The company has set ambitious goals aligned with its ‘Real Zero’ plan, striving to eradicate all carbon emissions by 2045. The corporation has consistently increased its dividends for 27 successive years, presently disbursing a quarterly dividend of $0.4675 per share. As of October 14, the stock reflects a dividend yield of 3.43%.

NextEra Energy, Inc. (NYSE:NEE) was a part of 59 hedge fund portfolios, the same as in the previous quarter, as per Insider Monkey’s database. The collective value of stakes owned by these hedge funds is over $918.3 million.

2. General Electric Company (NYSE:GE)

Number of Hedge Fund Holders: 71

General Electric Company (NYSE:GE), established in 1892 and registered in the state of New York with headquarters in Boston, is a prominent American multinational conglomerate. The company operates across various divisions, encompassing aerospace, power, renewable energy, digital industry, additive manufacturing, as well as venture capital and finance.

During the second quarter, General Electric Company (NYSE:GE) disclosed a non-GAAP EPS of $0.68 and revenue of $16.7 billion, surpassing predictions by $0.22 and $1.5 billion, respectively. The company enhanced its FY 2023 organic revenue growth projection, shifting it to a low-double-digit range from the initial high-single-digit range. Additionally, the adjusted EPS outlook was raised to $2.10 to $2.30 from the earlier projection of $1.70 to $2.00.

In the second quarter, 71 hedge funds had a stake worth nearly $10.2 billion in General Electric Company (NYSE:GE). In the previous quarter, the company was a part of 59 hedge fund portfolios with a combined stake of $7.6 billion. The most prominent stake in Q2 was held by Chris Hohn’s TCI Fund Management with 41.65 million General Electric Company (NYSE:GE) shares worth $4.575 billion.

Vulcan Value Partners made the following comment about General Electric Company (NYSE:GE) in its Q1 2023 investor letter:

“General Electric Company (NYSE:GE) was a material contributor during the quarter. With the successful spin-off of GE HealthCare in early January, the company operates in two major markets: GE Aerospace and GE Vernova. GE Aerospace powers three out of every four commercial flights. GE Vernova helps generate 30% of the world’s electricity and has a meaningful role to play in the energy transition. The company’s service activities, which are higher margin and more resilient, represent approximately 60% of revenue and 85% of its backlog. The company reported strong fourth quarter 2022 results and management’s 2023 outlook is positive.”

1. Tesla, Inc. (NASDAQ:TSLA)

Number of Hedge Fund Holders: 79

Tesla, Inc. (NASDAQ:TSLA), headquartered in Austin, Texas, is a prominent American multinational company specializing in electric vehicles, stationary battery energy storage units for various scales (from residential to grid-level), solar panels, solar shingles, and associated products and services.

In September 2023, Tesla Inc. (NASDAQ:TSLA) was granted the green light by the Public Utility Commission of Texas to initiate two trial programs for its Virtual Power Plant (VPP) initiative. This authorization empowers owners of Tesla Powerwall systems to sell surplus solar-generated energy back to the Electric Reliability Council of Texas (ERCOT) grid, forming a sizable distributed battery capable of aiding peak demand and averting blackouts. Anticipated is further approval for an additional six VPPs by Tesla Inc. (NASDAQ:TSLA) in Texas, benefiting from a conducive ERCOT market, enabling real-time experimentation and tangible real-world impacts.

Based on the Insider Monkey database, Tesla, Inc. (NASDAQ:TSLA) was in the portfolios of 79 hedge funds during the second quarter of 2023, positioning it as the top green stock to invest in. Notably, Cathie Wood of ARK Investment Management has expressed a strong bullish sentiment towards Tesla, Inc. (NASDAQ:TSLA) for an extended period and emerged as the leading hedge fund holder of the company.

Baron Funds made the following comment about Tesla, Inc. (NASDAQ:TSLA) in its Q1 2023 investor letter:

“Tesla, Inc. (NASDAQ:TSLA) designs, manufactures, and sells EVs, related software and components, and solar and energy storage products. Following a sharp decline at the end of 2022, Tesla’s stock rebounded in the first quarter of 2023 on investor expectations that Tesla will continue to grow vehicle deliveries and maintain solid gross and operating margins despite a potential recession, competition in China, and vehicle price reductions. We wrote a long piece on Tesla last quarter and refer readers back to it, because for long-term investors not much has changed over the last three months. Tesla did hold its first Investor Day in March, and several Baron analysts and portfolio managers attended. We toured the Austin Gigafactory, drove in a Cybertruck, boarded a Semi truck, and spoke with a wide swath of Tesla senior managers. During the formal presentation, Tesla highlighted, among other things: (1) its broad and deep bench of executive talent supporting CEO Elon Musk; (2) its “Master Plan 3–Sustainable Energy for All of Earth,” which featured EVs, renewable power from solar and wind, and stationary electric storage; (3) its vehicle assembly innovations, including massive casted parts (building Model Y bodies with single front and rear castings, replacing a substantial number of parts and fastening steps), a stainless steel exoskeleton (for Cybertruck), and its next-generation highly efficient “unboxed process” for its next-gen $25,000 vehicle; (4) a future permanent[1]magnet electric motor that will not require any rare earths; and (5) the massive untapped market opportunity for commercial stationary electric storage, branded Megapack, as the world steadily shifts to renewable energy. As long-term shareholders, we have witnessed Tesla exploit its innovative Model 3/Y now-global mass-market platform to increase vehicle deliveries from barely a standing start to over 1.3 million units, while achieving industry-leading margins and reinforcing its iron-clad balance sheet to almost $23 billion in cash (and effectively no recourse debt). We expect Tesla’s next-generation EV and Megapack products to have a similar impact on company results.”

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