Clean energy is a growing industry, and there are now many ways to invest in it. One way is to invest in energy penny stocks. These stocks can be risky because they’re so new, but they can also yield high rewards as the technology improves. Penny stocks can be found on the OTC markets and traded through online brokerages.
With tensions between Russia and Ukraine still rising, investors are looking for more secure investments. Cheap and reliable sources of energy have become more important in this climate. The US and other European countries have taken measures against Russia for its recent actions by imposing sanctions on Russian companies. However, many analysts believe the sanctions will be lifted due to Europe’s heavy dependency on Russian gas.
Due to these factors, many analysts believe we could see an amplified shift towards renewable energy. Although we are already seeing a massive secular change in this regard, it will only grow due to the current crisis.
Picking energy penny stocks can be difficult and time-consuming due to the huge number of penny stocks with little information online. So here are three potential penny stock picks that you should consider:
Energy Penny Stocks: Sunworks (SUNW)
Solar power has been rising for years, with renewable energy emerging as a viable option for businesses and consumers alike. In recent years, the solar power industry has also seen significant growth in response to increasing interest from organizations and consumers.
Sunworks is a company specializing in offering solar power systems for various agricultural, commercial, and industrial purposes. It uses photovoltaic (PV) technology to generate electricity from the sun to solve energy problems.
It designs and installs systems of different sizes around the globe, including those that need financing. Projects range in size from 2kW to multi-MW power stations.
In spite of being one of the most innovative companies on the market, investors have been hesitant to invest in this company. That is because the company has not provided many reasons as to why one should invest in them.
Quarter after quarter, it has disappointed markets by missing earnings estimates. Sunworks ended up missing on its EPS and sales due, in part, to challenges they faced with their supply chain. However, with a focus on better profitability in commercial and industrial divisions, the company could have a strong comeback.
Ocean Power Technologies (OPTT)
There are many different ways wind turbines work. One system is at sea. It uses the motion of waves to produce electricity and the spar and heavy plate to keep it secure. Meanwhile, onboard lithium-ion batteries will store energy for later use when there isn’t enough power coming from the waves.
There are many different uses for the platform, but offshore oil drilling is the most common. It has natural applications for these projects, and its scalability makes it the most viable option. Ocean Power also offers a solar and ocean-based hybrid product. There are several advantages to combining ocean power and solar energy, such as generating more energy in a day than one by itself.
There are also two other areas where the company is looking to develop its business. The first is through selling data to its customers. Shortly, data will be the new gold, and companies will do anything to obtain it. The company believes its Data-as-a-Service segment, which is powered by its flagship product Maritime Domain Awareness Software and WAM-V autonomous surface vessels, has the potential to become the biggest recurring revenue generator.
In addition, the Power-as-a-Service segment will be popular since many people are keen on leasing power. However, remember, this is still an unprofitable business. Therefore, you will have to remain patient with this one.
Energy Penny Stocks: Denison Mines (DNN)
Denison Mines is a company that focuses on uranium mining and storage. After implementing an operational and financial plan last year, it had strong year-end results.
Coal and natural gas are being increasingly used as sources of electricity for emerging nations. Coal is cheap and mostly releases carbon dioxide, but it is not the cleanest fuel. Natural gas emits less carbon dioxide than coal, but it’s much more expensive. Nuclear power plants produce unlimited power with completely no carbon released into the air.
No one wanted to touch uranium as an energy source for several years. This was because uranium is extremely radioactive, making it difficult to work with. However, there have been some major developments in nuclear power, and uranium uptake has been on the rise.
One of Denison’s main goals is to increase production on the Wheeler River Mine by building two mines. They have already set some milestones for each mine this year.
However, it’s also fair to highlight certain concerns. It will be several years before the mines come online and require a large amount of capital. In addition, the company has issued a lot of equity to finance its operations, leading to massive shareholder dilution. In short, you will have to be patient with this investment.
On the publication date, Faizan 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.