Renewable energy stocks may be a controversial idea for some folks. After all, the concept of green solutions sometimes conjures up images of tree-hugging activists disrupting various commercial activities. Some investors may not want to support such hooliganism.
At the same time, society is changing. In particular, more people – especially the younger generations – care about eco-friendly strategies than prior generations. One study pointed out that three out of four Generation Z consumers prioritize sustainability than brand names when shopping.
In other words, you might not care about going green and that’s entirely your prerogative. However, the changing world does care – and you could be profitable by supporting the trend. With that, below are renewable energy stocks to consider.
Ormat (ORA)
Falling under the broad utilities segment, Ormat (NYSE:ORA) engages in the geothermal and recovered energy power business. It features operations in the U.S., Indonesia, Kenya, Turkey, Chile, Guatemala, Guadeloupe, New Zealand, Honduras and other international regions. Further, the company operates in three segments: Electricity, Product and Energy Storage. Since the start of the year, it’s down almost 14%.
Over the past 52 weeks, ORA stock also slipped nearly 19%. That doesn’t seem particular reasonable given Ormat’s solid financial performance. Its worst showing least year – in terms of earnings per share – was the fourth quarter. Back then, it posted EPS of 59 cents, matching the expected target. Overall, the average positive earnings surprise came out to 22.58%.
For the current fiscal year, experts see EPS reaching $2.13 on sales of $888.2 million. That compares quite favorably to last year’s metrics of $2.08 and $829.42 million, respectively.
Analysts rate ORA a consensus moderate buy with a $75.63 average price target. That implies about 15% growth potential, making it an interesting idea for renewable energy stocks.
Brookfield Renewable (BEPC)
Another entity in the broader utility space, Brookfield Renewable (NYSE:BEPC) owns and operates a portfolio of renewable power and sustainable solution assets primarily in the U.S., Europe, Colombia, and Brazil. It operates hydroelectric, wind, solar, and distributed energy and sustainable solutions with an installed capacity of approximately 19,161 megawatts. It’s a new enterprise, being incorporated in 2019.
Since the start of the year, BEPC stock incurred a loss of more than 17%. In the past 52 weeks, it’s down almost 25%. Likely, the volatility stems from a credibility challenge. Between Q1 and Q3 last year, Brookfield posted red ink on the bottom line. The average negative surprise was 54.3%. However, in Q4, the company posted EPS of a penny, beating the expected loss of 14 cents.
For 2024, experts believe Brookfield will incur a loss of 48 cents. That’s more than the loss of 32 cents from last year. However, revenue could jump to $6.14 billion, up nearly 22% from 2023’s print of $5.04 billion.
Covering analysts remain optimistic, pegging shares a moderate buy with a $32.50 price target. Thus, it’s an enticing idea for renewable energy stocks.
Clean Energy Fuels (CLNE)
Technically falling under the oil and gas refining and marketing segment, Clean Energy Fuels (NASDAQ:CLNE) provides natural gas as alternative fuels for vehicle fleets and related fueling solutions in the U.S. and Canada. It supplies renewable natural gas (RNG), compressed natural gas (CNG) and liquefied natural gas (LNG) for medium and heavy-duty vehicles.
Since the start of the year, CLNE dropped nearly 31% of equity value. Over the past 52 weeks, it incurred a loss of over 38%. Clearly, this is not one of the renewable energy stocks for the faint of heart. That said, the market might be a bit too harsh on Clean Energy. For example, its earnings performances last year were decent save for a miss in Q1.
For the current fiscal year, experts believe the company will incur a loss per share of 13 cents. That’s worse than last year’s print of a loss of 6 cents. However, they also forecast sales of $441.43 million, up 3.8% from last year’s print of $425.16 million. Also, the high-side target calls for $512.4 million.
Analysts rate CLNE a consensus strong buy with an $8.25 target. That implies almost 214% upside potential.
On the date of publication, Josh Enomoto 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.
