Alternative energy stocks are getting attention as the worldwide push toward renewable energy gains momentum. Amid concerns over the environment, innovative businesses, driving innovation are facilitating this crucial transition.
As renewables are projected to become the world’s largest electricity source, long-term investors should add alternative energy stocks in their portfolios.
Greene energy stocks represent arguably the most attractive opportunities of the next decade. As some leaders strive to reduce emissions and tackle climate change, clean energy investments could prove lucrative.
Recent developments, such as President Joe Biden signing the Inflation Reduction Act, allocate a colossal 370 billion to renewable energy over the next ten years, to show a firm commitment to the sector.
Companies spearheading novel renewable energy solutions should feel upbeat that demand will remain robust. Wagering on clean energy stocks harnessing resources presents a bright future for eco-conscious investors.
| NEE | NextEra Energy | $76.09 |
| ORA | Ormat Technologies | $83.62 |
| ENPH | Enphase Energy’s | $162.92 |
| CCJ | Cameco Corporation | $27.08 |
| PLUG | Plug Power | $7.61 |
| FSLR | First Solar | $215.01 |
| OPTT | Ocean Power Technologies | $0.51 |
NextEra Energy (NEE)
NextEra Energy (NYSE:NEE) stands out as a trailblazer in the renewable energy landscape, offering a unique combination that makes it a remarkably potent investment. It operates two businesses that work in tandem, Florida Power & Light and NextEra Energy Resources.
This combination of a defensive utility service and a fast-evolving renewable energy operation positions NEE as a true innovator in the sector.
It also makes it one of the safest bets in the alternate energy space, boasting a price return of roughly 400% in the past decade. On top of that, you have its sweet dividend that has remained unshaken since 1995, a key characteristic of utility stocks. NextEra Energy’s investment proposition makes it a top investment option to bet on for the long haul.
Ormat Technologies (ORA)
Ormat Technologies (NYSE:ORA), is a leader in the geothermal energy sphere with its power plants spanning four continents.
It boasts a profitable business that has generated 12% and 49.2% net income and EBITDA margins respectively, over the past five years. Moreover, based on the growing demand for alternate energy, the geothermal space is poised for massive long-term growth ahead. It has around 11 projects in the pipeline to deliver further gains.
It’s coming off a stellar year, marked by above-average growth of roughly 11% last year.
The management team expects a 16% to 17% growth in total capacity through 2025 with forward revenue estimates at 12.7%. The firm has been paying dividends for the past eight years, with its 10-year dividend growth rate at 20%. Analysts at TipRanks foresee a 9% upside in ORA stock, making it a tempting prospect for forward-thinking investors.
Enphase Energy (ENPH)
Enphase Energy’s (NASDAQ:ENPH) innovative microinverter technology positions it as an elite solar stock worth following. It is on a mission to enhance solar power efficiency and reliability. It’s developing the technology to enable users to build their own mini-backup grid.
Apart from its microinverters, Enphase offers comprehensive battery storage systems to monitor and control solar energy. Over the years, it’s been a hyper-growth stock, with its top line growing by more than 50% on average over the past five years.
Forward estimates suggest revenue growth should be more than 40%. Though its recent forward guidance did not meet expectations, the company is an excellent long-term investment if you can stomach the volatility.
Cameco Corporation (CCJ)
Cameco Corporation (NYSE:CCJ) is a behemoth in the uranium production realm, boasting strategically positioned mines in Canada, the U.S., and Kazakhstan.
The firm has benefitted immensely from the uranium bull market that is still in its early stages. Moreover, it boasts proven exploration capabilities amid the global acceptance of nuclear power as a powerful alternate energy source.
With established operations and a solid footing in the market, Cameco is poised for massive growth ahead.
Year-over-year sales growth for the company is at an impressive 36%, with EBITDA growth at over 80%. Forward estimates point to more than 19% top-line growth with a solid contract portfolio, where it’s secured 215 million pounds of uranium and over 70,000 tons of UF6 conversion under long-term agreements.
This might yield approximately 24% higher sales volumes over the next five years. In response to these promising prospects, Cameco has confidently increased its 2023 revenue forecast by around $100 million, now projecting a range of $2.22 to $2.37 billion.
Plug Power (PLUG)
Plug Power (NASDAQ:PLUG) is one of the leading players in the burgeoning green hydrogen realm, with a robust track record of posting double-digit top-line growth over the years.
However, PLUG stock has taken a beating of late, as the Street expresses concern over the company’s negative margins.
Nevertheless, it remains in hyper-growth mode, with analysts predicting a revenue surge from $700 million to a whopping $1.3 billion this year, thanks to the expansion of its green hydrogen production facilities.
Moreover, hydrogen has a massive upside ahead, as the massive potential as a clean energy source remains irrefutable. Morgan Stanley analysts predict a whopping $11 trillion global hydrogen market in the coming decades. Hence, PLUG stock remains a tremendous bet over the long run.
First Solar (FSLR)
First Solar (NASDAQ:FSLR) is one of the top manufacturers in the solar energy space, thanks to its proprietary thin-film solar panels.
These innovative panels excel in challenging conditions, and are significantly more cost-effective compared to their counterparts. As the industry evolves, First Solar’s unique offerings could make it the go-to choice for covering expansive surfaces in arduous conditions.
Financially, First Solar boasts a sturdy foundation. It has a whopping $2.3 billion in its cash till, with just $368 million in debt. Moreover, its profitability metrics have outperformed industry averages over the years.
Though its top and bottom-line expansion have slowed down of late due to economic headwinds, the firm’s financial flexibility should enable it to maneuver through tough times.
First Solar is investing in expanding its manufacturing capacity, which should boost revenue and profits in the long run.
Ocean Power Technologies (OPTT)
Ocean Power Technologies (NYSEAMERICAN:OPTT) harnesses the kinetic energy in waves with its patented buoys under the PowerBuoy brand.
These buoys capture and store energy while also providing real-time data communications for remote maritime and subsea applications as one of the few publicly-traded companies in tidal energy production, Ocean Power Technologies has a first-mover advantage in the emerging sector.
The PowerBuoy system constantly recharges itself by harvesting wave energy and effectively operates in water depths ranging from 20 meters to 3 kilometers.
Its recently reported first-quarter results boast a 51% revenue increase, with sales up by 75% in the nine months ending January 31st. Potential investors should exercise caution, as losses currently outpace revenues. With the utility of its services across multiple industries such as defense, energy, offshore wind, and others, Ocean Power holds potential as an intriguing speculative investment in the renewable energy sector.
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
