The International Energy Agency’s Renewables 2023 report highlights the rapid expansion of renewable power capacity worldwide, which grew by 50% in 2023, led by China, Europe, the United States, and Brazil. Solar photovoltaic (PV) and wind accounted for most of this growth, emphasizing the significant potential of strong buy solar stocks. Even with supply chain disruptions and higher costs in the wind industry, solar PV costs have declined significantly, making solar stocks attractive investments.
Given their reasonable valuations, many solar stocks are poised for seven-figure gains for lucky investors. Evaluating individual companies’ financial health, growth prospects, and competitive positioning is crucial. This June, several solar stocks have received strong buy ratings from Wall Street analysts, highlighting their potential for substantial returns.
Renewable energy stocks, driven by government incentives and the global urgency to address the climate crisis, present intriguing growth opportunities. As countries strive to meet carbon emissions targets, investment in solar, wind, and hydroelectric power is expected to surge. As such, here are three solar stocks with strong buy ratings for June 2024. Each has the potential to become a multi-bagger and significantly boost investor returns.
First Solar (FSLR)
First Solar (NASDAQ:FSLR) is a leading American solar technology company specializing in the design and manufacture of solar modules using advanced thin-film photovoltaic (PV) technology.
FSLR projects its net sales for 2024 to be between $4.4 billion and $4.6 billion, with expected earnings-per-share (EPS) ranging from $13 to $14. The company also forecasts a gross margin of $2 billion to $2.1 billion and plans to sell between 15.6 GW and 16.3 GW of solar modules. Capital expenditures for the year are estimated to be between $1.8 billion and $2 billion.
Analysts have a positive outlook on First Solar, with strong growth expectations driven by policy support and strategic expansions. The company has a substantial sales backlog of over 78.3 GW, and year-to-date bookings total 2.7 GW. These factors contribute to a favorable long-term growth outlook.
FSLR appears fairly priced given its upside is just around 2% at the time of writing, per analysts. However, there could also be substantial revenue and EPS increases on the horizon.
Ameresco (AMRC)
Ameresco (NYSE:AMRC) is a leading cleantech integrator and renewable energy asset developer, owner, and operator. The company offers a wide range of services, including energy efficiency upgrades, renewable energy installations, and more.
Ameresco anticipates a strong performance in 2024 with an expected revenue growth of approximately 20% and an adjusted EBITDA growth of 38%. The company projects significant contributions from its Energy Asset business, with plans to place additional renewable energy assets into service throughout the year. This includes contributions from new solar and battery assets as well as renewable natural gas (RNG) projects. Ameresco has a robust project backlog exceeding $4 billion.
Ameresco made significant strides in expanding its footprint in Europe, with its European operations now accounting for over 10% of total revenue. The company also secured major project wins, including a $5 billion contract ceiling with the U.S. Department of Energy for energy performance contracts and several large-scale battery energy storage projects.
GE Vernova (GEV)
GE Vernova (NYSE:GEV) now operating as a standalone company after General Electric’s split into three companies, has a notable presence in the solar industry. For example, GEV has supplied solar inverters for major projects, such as the Dubai Electricity and Water Authority’s (DEWA) solar project, which is the largest of its kind in the Middle East. GEV has also contributed to studying the impact of high solar energy penetration on the grid, working with utilities like Arizona Public Service to optimize grid reliability and efficiency.
GE Vernova expects significant growth in 2024, with revenue anticipated to grow in the mid-to-high teens. Its operating profit projections now land between $6.1 billion and $6.4 billion. The company plans substantial investments of over $650 million in manufacturing facilities and the supply chain. This includes $550 million in site upgrades and $100 million in the supply chain. Furthermore, the company is focusing on new orders and expanding its commercial and defense businesses, which have seen strong growth.
On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
