8 Best Wind Power and Solar Stocks to Buy

2. NextEra Energy Inc. (NYSE:NEE)

Number of Hedge Fund Investors: 73

Stock Upside Potential: 1.02%

NextEra Energy Inc. (NYSE:NEE) is one of the best wind power and solar stocks to buy for exposure to generating, transmitting, and distributing electric power to retail and wholesale customers. The company generates power through wind, solar, and nuclear, among other clean energy options.

NextEra Energy Inc. (NYSE:NEE) is one of the largest wind power producers in the world, with 21 gigawatts of operating wind generation capacity. It has also announced plans to build as much as 11.5GW of new wind energy capacity by 2027, seeking to take advantage of the strong demand for clean energy for powering households and data centers amid the artificial intelligence revolution.

NextEra Energy Inc. (NYSE:NEE) is already moving quickly to address the expected 38% rise in power demand in the US. With the expected demand increment to be met through renewable energy and battery storage, the company is investing in the future. Consequently, it plans to sell $2 billion of equity units as it looks to raise much-needed capital to fund investments in energy and power projects.

In addition to a robust expansion plan, NextEra Energy Inc. (NYSE:NEE) has proven to be a key value generator, increasing its dividend payout by over 11% over the past five years. The company currently has a solid 2.61% dividend yield.

Analysts on Wall Street are bullish about NextEra Energy Inc. (NYSE:NEE), with an average price target of $79.88, implying 1.02% upside potential from current levels. On the other hand, 73 hedge funds out of 912 tracked by Insider Monkey held stakes in the company as of the second quarter. Rajiv Jain’s GQG Partners is the largest shareholder of the company, holding 12.49 million shares valued at $884.56 million.

ClearBridge Investments also mentioned this in its Q2 2024 investor letter. Here is what the firm has to say about NextEra Energy, Inc. (NYSE:NEE):

“AI-related momentum was a key driver of performance in the second quarter, lifting the enablers in technology as well as holdings like renewable power producer NextEra Energy, Inc. (NYSE:NEE) that supplies the increasing energy needs of data centers. Parts of the market lacking an AI connection, like our medical device holdings, underperformed despite no change to fundamentals. We have managed through several similar momentum periods over our tenure and have delivered long-term results for shareholders by staying true to an approach that emphasizes diversification across three buckets of growth companies (select, stable and cyclical) and seeks to take advantage of attractive entry points into quality growth businesses.”