5 Best Renewable Energy Stocks to Buy Now

Page 5 of 5

1. Tesla, Inc. (NASDAQ:TSLA)

Number of Hedge Fund Holders:  91

Tesla, Inc. (NASDAQ:TSLA) makes it to our list of the best renewable energy stocks because the company’s electric vehicles are playing  key role in deploying the renewable energy sources in the auto industry in addition to its Powerwall and solar roofs products for homes.

Recently, Jefferies upped its price target for Tesla, Inc. (NASDAQ:TSLA) to $230 from $180 and kept a Buy rating on the shares. Jefferies was encouraged by Tesla, Inc. (NASDAQ:TSLA)’s latest investor day. It said that the lack of new product announcements does not show major growth delays. Jefferies also upped its 2023 and 2024 operating earnings estimates for Tesla, Inc. (NASDAQ:TSLA) by 10% and 8%, respectively.

Tesla, Inc. (NASDAQ:TSLA) is also one of the most popular stocks among the elite hedge funds tracked by Insider Monkey. A total of 91 hedge funds tracked by Insider Monkey were bullish on Tesla, Inc. (NASDAQ:TSLA) at the end of the fourth quarter of 2022.

ClearBridge Large Cap Growth Strategy made the following comment about Tesla, Inc. (NASDAQ:TSLA) in its Q4 2022 investor letter:

Tesla, Inc. (NASDAQ:TSLA), meanwhile, also fits squarely within our earnings reset group. We took advantage of its enterprise multiple falling back to historic lows to initiate a starter position in the leading manufacturer of electric vehicles (EV) and developer of battery technologies. Tesla has a significant structural cost advantage in battery production, EV manufacturing and EV selling, which gives it industry-leading operating margins in EVs. As the auto cycle has softened, the stock has sold off substantially with the rest of the automakers, despite EVs continuing to have a secular growth advantage. Tesla has a clean balance sheet with negative net debt and enormous revenue growth, EBITDA growth and free cash flow generation. Its margin buffer also gives the company the ability to cut prices while still protecting earnings better than competitors, which should help support continued volume growth. There is also significant upside optionality driven by its software offerings, which we do not believe is currently priced into the stock.

That being said, Tesla is highly indexed to a flagging auto market and we expect its earnings outlook to worsen in the near term. We are also monitoring increasing EV competition and the recently emerging risks to the brand and management integrity raised by CEO Elon Musk’s actions at Twitter to determine future position size in the portfolio.”

You can also take a peek at 15 Best Short-Term Stocks to Buy and 10 Best Stocks to Buy for High Returns.

Page 5 of 5