As the global shift toward renewable energy accelerates, solar power has emerged as a leading force in transitioning to a sustainable future. Investors are increasingly looking to capitalize on this trend by adding top solar stocks to their portfolios.
With technological advancements and supportive government policies driving growth in the solar industry, several up-and-coming companies are poised for significant expansion.
In this blog, we will explore six top solar stocks that offer strong long-term growth potential, making them worth additions to any forward-thinking investor’s portfolio. These stocks represent the future of clean energy and the promise of substantial returns.
Why should you add Solar Stocks to your portfolio?
Even before Joe Biden was elected president, solar energy was predicted to develop significantly. However, his administration has the potential to accelerate the sector’s growth with its commitment to put the United States on the road toward an emissions-free future. His audacious plan calls for the United States to produce carbon-free electricity by 2035.
Biden also suggests expanding tax incentives and making direct investments to expedite the transition to clean energy. During his presidency, Congress has already approved two pieces of legislation that may help promote the growth of renewable energy in the nation.
As a result, growth in the solar business may be even more rapid in the upcoming years than anticipated. Another reason investors should consider investing in top solar stocks is its potential for expansion.
Best Solar Stocks to Invest in 2024
In this section, you’ll read in detail about the top solar stocks that you must watch out for and consider including in your portfolio.
Brookfield Renewable
Brookfield Asset Management (BAM 0.26%), a prominent alternative asset manager, founded Brookfield Renewable, a renewable energy yield. Under long-term power purchase agreements, the energy company sells the renewable energy it produces. The yield label results from Brookfield’s consistent cash flow from its business strategy, which enables it to pay a desirable dividend yield.
Brookfield has recently completed several acquisitions to strengthen its expertise in solar energy development. In 2022, it acquired Urban Grid, a prominent American developer of utility-scale solar and energy storage systems.
Through 2026, Brookfield expects to increase cash flow at an annual rate of 6% to 11% per share, thanks to its solar-powered development pipeline. Furthermore, it anticipates up to 9% of annual growth potential from future acquisitions, which should help the company achieve its goal of raising its high-yielding dividend by 5% to 9%. It is among the best renewable energy dividend stocks because of its growth.
SolarEdge Technologies
SolarEdge offers current inverter systems for solar installations that enable the panels to generate alternating current, or AC, power that can be sent across the energy grid. Unfortunately, the fact that this mid-cap solar company has its headquarters in Israel has made the challenges facing the solar industry much more formidable.
Shares have, therefore, dropped a heartbreaking 76% over the previous 12 months. However, if SEDG can recover in the upcoming months, this might be a hazardous but lucrative long-term gamble for bold investors betting on the future of top solar stocks as alternative energy.
First Solar
First Solar is one of the biggest and most well-known solar companies on Wall Street, founded in 1999. It produces solar modules primarily for big utility or independent power grid developers and operators for use in commercial and industrial applications.
Due to its emphasis on larger clients rather than residential end users, FSLR was less affected by the industry’s dismal forecast for 2023. As First Solar’s revenue was expected revenue to be between $3.4 billion and $3.6 billion, and full-year earnings per share to be between $7 and $8.
Additionally, its dominant market position assures that it can withstand short-term volatility as it looks to the future of alternative energy.
Enphase Energy
Enphase’s astounding 1,489% share price gain over the last five years through January 25th has attracted the attention of many solar investors, in addition to the company’s greater size than many of its competitors in the niche solar market.
Enphase has established itself as a leader in semiconductor devices known as microinverters, which transform the energy contained in those cells into energy that can be used in residences and commercial buildings. The analyst community is optimistic about the company’s long-term prospects because of its distinctive role in the solar field.
Just this past January, Truist upgraded the stock, and in the last few weeks, Canaccord Genuity also started covering the company with a “buy” rating.
Canadian Solar Inc.
As one might expect from its name, CSIQ is based in Canada, but it also maintains a sizable presence abroad, particularly in China, where the solar business is expanding rapidly. Additionally, CSIQ has a global energy business that delivers the real power generation from solar farms, in contrast to some of the other stocks on our list that merely make solar panels or related gear.
This diversification into a utility-style business model gives the company, albeit undoubtedly smaller than some of the other solar companies, a little more stability.
Daqo New Energy Corp.
China is home to Daqo’s headquarters and has one of the world’s most active solar markets despite the country’s more unstable economy. For example, research released in November by the consulting firm Woods Mackenzie predicted that China will hold over 80% of the global solar manufacturing capacity by 2026, with companies such as DQ playing a significant role in this growth narrative.
DQ’s growth rate is remarkable; in 2022, its total revenue was $4.6 billion, up from over $300 million in 2018. DQ is a wonderful choice for focusing on the industry’s prospects outside the US market.
Should you invest in Solar Stocks in 2024?
The solar energy sector continues to present compelling investment opportunities. Solar power is gaining significant traction as the world increasingly prioritizes renewable energy sources to combat climate change. Technological advancements, decreasing solar panel costs, and favorable government policies are driving the solar industry’s growth. Furthermore, the global push for net-zero carbon emissions by mid-century underscores the long-term potential of solar energy.
However, solar stocks have risks like all investments, including market volatility and regulatory changes.
Final Thoughts
Investing in up-and-coming solar stocks can be a savvy move as the world increasingly shifts toward renewable energy. The six stocks highlighted offer promising growth potential, driven by technological advancements, supportive government policies, and rising global demand for clean energy.
By incorporating these stocks into your portfolio, you can capitalize on the expanding solar market while contributing to a sustainable future. As with any investment, thorough research and a diversified approach are essential to managing risks and maximizing returns.
Stay informed about industry trends and company developments with ABBO NEWS to make the most of these exciting opportunities in solar energy.
Peter Williams, a financial writer with over five years of experience, specializes in covering stock market movements, bond markets, commodities, and macroeconomic trends.
