Below we presented the 5 best solar energy stocks to buy now. For our detailed discussion as well as a more comprehensive list please see 10 Best Solar Energy Stocks To Buy Now.
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best hydrogen fuel cell stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Keeping this in mind let’s take a look at the best solar energy stocks to buy:
5. Canadian Solar Inc (NASDAQ: CSIQ)
No of HFs: 25
Total Value of HF Holdings: $245 Million
Canadian Solar Inc is a Canada-based large-cap global company that produces and sells solar photovoltaic products and provides energy solutions as well as one of the largest solar power plant developers globally. With 16 GW module production capacity and 10 GW cell capacity, the company reaches 150 countries with 17 manufacturing facilities. In 2021, it is expected that a 10% growth in shipment capacity.
Stock gain this year is 148.3% and the compound 3 year revenue growth rate is 4.4%.
4. Sunrun Inc (NASDAQ: RUN)
No of HFs: 29
Total Value of HF Holdings: $3.271 Million
Sunrun Inc is a US-based large-cap residential solar system company. The business focuses on solar panel sales, storage systems, and financing. With $1.7 billion net earning assets and 20% growth in the customer base, the company has reached a $382 million total cash balance. Sunrun Inc has over 500,000 customers and has sold its solar service in 22 US states.
Stock gain this year is 526.7% and the compound 3 year revenue growth rate is 19,1%. Here is what Massif Capital said about Sunrun in 2020:
We laid out our thesis on Sunrun (NASDAQ:RUN) in our first-quarter letter to investors and concluded that while the company had dropped 50% in March, we still felt comfortable holding the short position, this was an error. We re-evaluated that posture in May, following a rapid rise in the stock price, and decided to exit the position as the title wave of liquidity entering the markets seemed more than enough to continue to support a firm dependent on capital markets for cash. Given the level of support we see in credit markets right now, our misgivings about their business model do not add up to sufficient catalysts to allow us to hold the position. We encourage readers to revisit our thesis on the company. We would highlight that our decision to re-enter at any point in the future will likely be a function of regulatory rulings on utility net metering practices or compelling evidence to suggest a decline in tax equity investing.
3. SolarEdge Technologies Inc (NASDAQ: SEDG)
No of HFs: 31
Total Value of HF Holdings: $553 Million
SolarEdge Technologies is an Israel-based but US-domiciled large-cap smart solutions company that provides power optimizers, solar inverters, and monitoring systems for photovoltaic arrays. They provide a large range of services from PV Professionals to Business Owners. Commercial and residential PV systems are the main business of the company besides distributed energy networks with grid services solutions. The company also benefits from selling solar PV system products such as inverters, software tools, and accessories.
Impax Asset Management had $114,1 million invested in the company at the end of the quarter. Stock gain this year is 231.3% and the compound 3 year revenue growth rate is 42.1%.
2. First Solar (NASDAQ: FSLR)
No of HFs: 40
Total Value of HF Holdings: $284 Million
First Solar is a US-based large-cap global company that develops, finances, engineers, constructs, and currently operates many of the world’s largest grid-connected PV power plants. Precisely, the company takes the advantage of its advanced solar PV cells manufacturing systems with warrantied for 25 years and competitive energy production per watt. With 25GW+ shipped worldwide historically, net sales have reached $928 million in third-quarter 2020.
Masters Capital Management was the largest shareholder of First Solar with a $66,2 million stake worth at the end of the third quarter. Stock gain this year is 84.6% and the compound 3 year revenue growth rate is 6.1%. Here is what White Brook Capital said about FSLR in 2020:
“First Solar’s position should be strengthened by Covid-19. The Company is significantly back ordered and while that backlog should lighten somewhat as utility expansion needs are temporarily postponed, I expect revisions to be limited. Residential solar installations will be far more limited as a combination of stay at home orders and the discretionary-ness of rooftop solar becomes clear. First Solar has distributed manufacturing and a proven product making travel less necessary than for their competitors as well.”
1. Enphase Energy (NASDAQ: ENPH)
No of HFs: 42
Total Value of HF Holdings: $1.045 Million
Enphase Energy is a US-based large-cap global energy technology company and supplier of solar micro inverters. The Company delivers solutions to residential and commercial solar PV systems as well as storage, accessories, and management app programs. Business revolutionized the solar industry with its microinverter technology and produces a fully integrated solar-plus-storage solution.
They reported revenue of $178.5 million in the third quarter of 2020. Furthermore, the business exited the third quarter with $661.8 million in cash and generated $67.5 million in cash flow from operations.
Sylebra Capital Management held $346 million worth of assets at the end of the third quarter which makes it the top holder. Stock gain this year is 573.3% and the compound 3 year revenue growth rate is 34.3%.
A final point about solar energy companies is that some companies may benefit from the possible carbon tax and carbon dividend. Besides, clean energy stocks have been surging, as the US Congress considers extending tax breaks for wind and solar energy. Without a doubt, residential solar developers will take the advantage of that to expand their business across the country. The whole PV sector with its accessories will continue to see major growth in 2021 with recovery hopes.
Please also see 15 Largest Coal Companies in The World and 11 Best Lithium and Battery Stocks To Buy Now.
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