Renewable energy stocks will continue being relevant as the world intensifies its fight against climate change. Despite recent setbacks, the undeniable march towards a greener future powers on, underscored by the commitment to slash carbon emissions. Renewable energy sources stand at the cusp of this transformative journey, embodying the push towards environmental goals. However, the road hasn’t been without its bumps. After a period of heavy investment spurred by a promising outlook, the landscape for renewable stocks shifted dramatically with growing interest rates, rendering earlier financial strategies relatively ineffective.
However, with the expectations of falling interest rates, the sector is beginning to become more attractive, presenting renewed opportunities for growth in the clean energy domain. This pivot points towards a rather encouraging future for renewable energy investments, making it a compelling time for stakeholders to reconsider the value of renewable energy stocks.
Renewable Energy Stocks: NextEra Energy (NEE)
NextEra Energy (NYSE:NEE), a utility titan, is effectively redefining the landscape of renewable energy with impressive strides in wind and solar production. Through its subsidiary, Florida Power & Light, and its investments in clean energy, the company has become a key player in powering the nation’s transition to sustainable energy sources.
It wrapped up 2023 with aplomb, posting a nearly 10% increase in EPS to $3.17 but also reporting a commendable 13% jump in adjusted earnings growth. These achievements add to NextEra’s impressive bottom-line health, particularly within its energy transmission segment, which plays a key role in distributing renewable energy across the country. Adding to its list of accolades, NextEra Energy announced its most successful year in terms of renewables, with a significant addition of approximately 9,000 megawatts to its backlog.
Moreover, NEE stock remains one of the best income plays in its niche, yielding a handsome 3.56% with 28 consecutive years of payout expansion.
Beam Global (BEEM)
EV charging upstart, Beam Global (NASDAQ:BEEM) is marching forward with purpose in its niche. It turned heads recently with 47 of its Beam EV ARC sustainable off-grid charging systems from The U.S. Department of Homeland Security. Moreover, its momentum is bolstered further by securing orders for solar-powered EV charging systems from six federal agencies. CEO Desmond Wheatley is optimistic about deepening and expanding government business in the U.S. and internationally, underscoring the firm’s growth trajectory.
Furthermore, the acquisition of Serbian streetlight firm Amiga is set to enhance Beam’s footprint in Europe. Amiga reported a profitable year in 2022 and is likely to pave the way for the European debut of the ARC 2000 sales and the introduction of the new EV-Standard product. This innovative offering combines grid-connected streetlights along with integrated EV charging and renewable energy storage capabilities, positioning it as one of the top players in its niche.
Cameco (CCJ)
Cameco (NYSE:CCJ) is a leading force in the global uranium market and one of the most significant uranium producers. Its core business revolves around mining and selling uranium concentrate, a key component in producing nuclear energy.
The push for a carbon-neutral future is making governments across the globe acknowledge the critical role of nuclear energy in achieving climate goals. Moreover, according to the World Nuclear Association (WNA), there’s expected to be a 28% bump in uranium demand by 2030, with expectations nearly doubling by 2040.
Echoing WNA’s sentiment, Cameco’s CEO Tim Gitzel remarked during the fourth-quarter (Q4) earnings call that the uranium industry is experiencing more than a fleeting surge. With a notable 61% increase in year-over-year revenues, the firm is riding a wave of global factors likely to influence the market for years to come. These factors include escalating supply-demand challenges and uranium prices hitting their highest in 16 years.
Air Products and Chemicals (APD)
Air Products and Chemicals (NYSE:APD), is a dominant force in the hydrogen sphere, catering to diverse sectors including food, medicine, chemicals, and others. It boasts its expertise in air separation, gas liquefaction, and the transportation and storage of gases. Moreover, it recently announced a significant milestone by equipping its 2,000th seagoing vessel with nitrogen generation systems, reinforcing its position in its niche.
Despite facing challenges in the last quarter, APD demonstrated resilience and posted encouraging results. The company reported a GAAP EPS of $2.73, reflecting a 5.60% increase, along with an adjusted EPS of $2.82, representing a 7% bump. This achievement came despite a sizable 6% drop in year-over-year (YOY) sales growth. However, strategic pricing and greater volume helped mitigate these impacts. Consequently, Air Products raised its 2024 adjusted EPS guidance, anticipating a 6% to 9% bump.
Furthermore, APD announced an increase in its quarterly dividend to $1.77 per share in late January, raising its payout for the 42nd consecutive year, showcasing its stable and growing financial foundation.
First Solar (FSLR)
First Solar (NASDAQ:FSLR) is one of the top players in solar technology, showcasing a compelling investment profile. It trades at 12 times forward non-GAAP earnings, roughly 52.20% below the sector’s median.
Its financial turnaround in Q4 is striking, reporting a profit of $349 million, a significant reversal from the previous year’s $7.5 million loss. This remarkable improvement was mainly linked to a $400 million surge in net sales due to higher module sales. Looking ahead, First Solar has set ambitious targets for fiscal year 2024, projecting earnings of $13 to $14 per share on revenues ranging between $4.4 billion and $4.6 billion. Analyst consensus estimates are at $13.26 EPS on $4.56 billion in revenues.
Moreover, the company’s future looks promising, bolstered by a $1.1 billion investment for a new Louisiana factory by 2025. Additionally, CEO Mark Widmar talked about the significance of 2023 being a landmark year, marking significant manufacturing expansion, record production and shipments, along with robust backlog expansion.
Clearway Energy (CWEN)
Clearway Energy (NYSE:CWEN), ranks as the fifth-largest renewable energy business in the U.S., boasting an impressive portfolio exceeding 8,000 MW of assets. The bulk of its portfolio includes solar and wind generation projects followed by green natural gas production facilities. Clearway Energy’s business has held up well despite facing market headwinds, reaffirming its 2024 full-year Cash Available for Distribution (CAFD) guidance at $395 million. This confidence is manifested further through its dividend policy, with it committed to targeting annual dividend per share growth between 5% to 8% through 2026.
In a strategic expansion of its renewable energy endeavors, Clearway Energy recently completed a 452 MW Solar Nova complex in Texas, which could potentially power more than 190,000 homes annually, These developments underscore Clearway Energy’s proactive approach to growth and its key role in the transition towards a more sustainable energy landscape.
Algonquin Power & Energy (AQN)
Algonquin Power & Energy (NYSE:AQN) is a key player in the North American renewable energy and utility sector. It specializes in hydroelectric, wind, and solar power, and its essential operations continue to showcase resiliency. Despite facing adverse market conditions, AQN’s blend of traditional regulated utility services and a dedicated renewable energy subsidiary underscores its strategic positioning.
AQN’s Q4 results were encouraging despite the drop in revenues and uncertainties over the timing of its renewables unit sale. With a notable net profit of $186.3 million, the company touts 2024 as a transition year, where the focus is on streamlining operations and refining future strategies. Despite the uncertainty over the sale of its renewables segment, it isn’t slowing down, announcing 300 MW of solar projects and a 1,660 MW boost to its development pipeline.
Nevertheless, investors should keep a close watch on AQN, considering both short-term and long-term investment strategies might be prudent, capitalizing on news-driven price swings or to secure positions in anticipation of growth post-sale.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines