In this article, we discuss the 9 best clean energy stocks to buy today. If you want to skip our detailed analysis of these stocks, go directly to the 5 Best Clean Energy Stocks To Buy Today.
The renewable energy sector is attracting more investors as the demand for wind, solar, and hydroelectric energy sources continue to rise. The government’s effort in many countries around the world to transition to the use of clean energy is one of the major catalysts driving growth in the renewable energy sector. According to BloombergNEF (BNEF), the global investment in the energy transition set a new record of $755 billion in 2021.
For instance, US House Democrats have renewed calls to President Joe Biden to proceed with the $555 billion in climate change investments already approved by the House as part of the Build Back Better Act. The climate change program includes tax incentives to expand and accelerate investments in renewable power generation, including wind, solar and nuclear. Also included in the climate plan is a proposal to provide an electric vehicle tax credit ranging from $7,500 up to $12,500 for vehicles built at a unionized factory in the U.S. According to Reuters’ report published in December, the bill would also make Tesla, Inc. (NASDAQ:TSLA) and General Motors Company (NYSE:GM) eligible for tax credits after reaching the 200,000-vehicle cap on the current $7,500 credit.
Clean energy stocks are also benefiting from the growing support for environmental, social, and governance (ESG) factors of many businesses around the world. Microsoft Corporation (NASDAQ:MSFT), one of the world’s most-followed ESG firms, buys renewable energy for its facilities around the world and aspires to achieve 100% carbon-free electricity use by 2030. The transition to clean energy is expected to accelerate this year, from large corporations to solar-powered homes. According to the International Energy Agency’s (IEA) 2021 forecast, global renewable electricity capacity is expected to increase by more than 60% from 2020 levels to over 4,800 GW by 2026.
Finally, the Russian invasion of Ukraine is another important factor that’s causing a surge in the share price of renewable energy stocks. The war between the two countries is directly impacting renewables because clean energy offers a more cost-effective alternative to fossil fuels, which are still rising to record highs. Some of the clean energy big winners after President Biden announced the ban on Russian oil imports to the US are Tesla, Inc. (NASDAQ:TSLA), NextEra Energy, Inc. (NYSE:NEE), and Enphase Energy, Inc. (NASDAQ:ENPH).
Our Methodology
We chose the clean energy stocks in our list from a wide range of sectors and industries, including utility, electric vehicle, manufacturing, and solar technology such as solar panel producers. Using Insider Monkey’s Q4 2021 data, we ranked these companies based on the number of hedge funds that had stakes in them. Furthermore, we only included stocks that are favored by market analysts in our list.
Best Clean Energy Stocks To Buy Today
9. SunPower Corporation (NASDAQ:SPWR)
Number of Hedge Fund Holders: 20
SunPower Corporation (NASDAQ:SPWR) is one of the market’s best-performing clean energy stocks today, with shares up 22.9% on March 8 as the solar industry rallied in response to Russia’s invasion of Ukraine. On top of that, the company is extending its national presence through a multi-year partnership with homebuilder Landsea Homes Corporation (NASDAQ:LSEA). With this collaboration, SunPower Corporation (NASDAQ:SPWR) is now Landsea Homes’ sole supplier of solar technology.
SunPower Corporation (NASDAQ:SPWR) expanded its customer base by 17,000 in Q4 2021, a 31% increase year over year, bringing its total customer install base to 427,000. The California-based solar technology provider grew its revenue in the fourth quarter by 13% to $385 million.
Just like Tesla, Inc. (NASDAQ:TSLA), NextEra Energy, Inc. (NYSE:NEE), and Enphase Energy, Inc. (NASDAQ:ENPH), SunPower Corporation (NASDAQ:SPWR) is one of the best clean energy stocks to buy today, according to market analysts. On February 17, Baird analyst Ben Kallo maintained an Outperform rating on SunPower Corporation (NASDAQ:SPWR) with a price target of $20. Meanwhile, at the end of the fourth quarter of 2021, 20 funds out of 924 had a long position in the solar energy company, with a total stake of $118 million. D E Shaw, a New York-based hedge fund, had the largest stake in SunPower Corporation (NASDAQ:SPWR), with 3.23 million shares worth $67.4 million.
8. Brookfield Renewable Partners L.P. (NYSE:BEP)
Number of Hedge Fund Holders: 21
Global decarbonization leader Brookfield Renewable Partners L.P. (NYSE:BEP) is one of the best clean energy stocks to buy today, being one of the largest renewable energy companies in the world. Brookfield Brookfield Renewable Partners L.P. (NYSE:BEP) owns and operates solar, wind, and hydroelectric renewable energy generating facilities in North and South America, Europe, the Middle East, and the Asia Pacific.
Brookfield Renewable Partners L.P. (NYSE:BEP) received substantial contributions from its wind and solar businesses, with FY 2021 FFO increasing 67% and 16% year over year to $396 million and $934 million, respectively. Overall, the company’s revenue last year jumped 9% to $3.37 billion. To top this, the Bermuda-based utility company currently pays an annual dividend of $1.23 per share.
Hedge funds and market analysts became more bullish on Brookfield Renewable Partners L.P. (NYSE:BEP) due to the strength of its renewable energy business and its massive worldwide reach. In the fourth quarter of 2021, 21 hedge funds held a total stake of $234 million in Brookfield Renewable Partners L.P. (NYSE:BEP), up from 17 in the previous quarter. Meanwhile, Wells Fargo analyst Jonathan Reeder maintained an Overweight rating on the shares with a price target of $40.
As of the end of December 2021, Select Equity Group holds the biggest share in Brookfield Renewable Partners L.P. (NYSE:BEP). The New York-based investment firm increased its stake in the renewable energy company by 1,467%, bringing its total holdings to 1.13 million shares worth $41 million.
In the Q1 2021 Investor Letter, ClearBridge Investments highlighted a few stocks and Brookfield Renewable Partners L.P. (NYSE:BEP) is one of them. Here is what the fund said:
“U.S. renewables utility Brookfield Renewable was another detractor. Brookfield Renewable is a pure-play renewables operator and developer headquartered in Canada and domiciled in the U.S., focused on international hydro, solar, wind and storage technology. As more private and public institutions announce ambitious carbon reduction initiatives, Brookfield Renewable’s globally diversified, multi-technology renewables business makes it an attractive partner. Its development pipeline stands at 18,000 megawatts, providing confidence the company can meet its targeted double-digit cash flow growth through to 2025. Shares moderated amid expectations of rising bond yields, and a cool-off on the green trade.”
7. Consolidated Edison, Inc. (NYSE:ED)
Number of Hedge Fund Holders: 22
Investors are also looking at utility company Consolidated Edison, Inc. (NYSE:ED) as one of the best options in diversifying their portfolio with clean energy stocks. Consolidated Edison, Inc. (NYSE:ED) is a well-known dividend aristocrat, having increased its dividend distribution consistently for the past 48 years. As of March 13, the dividend-paying company has a yield of 3.54%, which is higher than the utility sector’s average of 3.2%.
Consolidated Edison, Inc. (NYSE:ED) claims to be North America’s second-largest solar power producer. In its New York segment, the company is providing electric service to approximately 3.3 million customers. The company recently announced a $4.7 billion capital investment planned for “green” projects from 2022 to 2024. The utility company’s renewable segment had 3,004 MW of utility-scale renewable energy projects in service or construction during the fourth quarter of 2021. As of March 14, shares of Consolidated Edison, Inc. (NYSE:ED) jumped 10% in the previous month.
Anthony Crowdell of Mizuho increased his price target for Consolidated Edison, Inc. (NYSE:ED) to $94 from $90, while maintaining his Buy rating on the shares. Ken Griffin’s Citadel Investment Group is one of the biggest shareholders of the New York-based utility firm. The Chicago-based hedge fund firm increased its stake in Consolidated Edison, Inc. (NYSE:ED) by 24% in Q4 2021, bringing its total holdings to 450,122 shares worth $38.4 million.
6. Plug Power Inc. (NASDAQ:PLUG)
Number of Hedge Fund Holders: 23
Plug Power Inc. (NASDAQ:PLUG) has been identified by hedge funds as one of the top clean energy stocks to consider, alongside Tesla, Inc. (NASDAQ:TSLA), NextEra Energy, Inc. (NYSE:NEE), and Enphase Energy, Inc. (NASDAQ:ENPH). Overall, 23 out of the 924 funds tracked by Insider Monkey held stakes in Plug Power Inc. (NASDAQ:PLUG) in the fourth quarter of 2021, up from 20 funds a quarter earlier. D E Shaw is among the biggest shareholder of Plug Power Inc. (NASDAQ:PLUG), holding more than 5.8 million shares worth $166 million.
The New York-based hydrogen fuel cell manufacturer is another company that operates in the renewable energy sector. Plug Power Inc. (NASDAQ:PLUG) utilizes fuel cell power and hydrogen solutions in serving different industries such as electric mobility, stationary power, and material handling. Plug Power Inc. (NASDAQ:PLUG) announced a record year in Q4 2021, with $162 million in quarterly revenue, the company’s biggest quarterly revenue ever.
In 2022, the hydrogen fuel cell firm anticipates generating $900 to $925 million in revenue, representing an increase of 80% year over year. Canaccord analyst Jed Dorsheimer kept his Hold rating on Plug Power Inc. (NASDAQ:PLUG) with a price target of $21.
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Disclosure: None. 9 Best Clean Energy Stocks To Buy Today is originally published on Insider Monkey.
