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Green energy stockholders didn't have much fun last year.
For example , the First Trust NASDAQ Clean Edge Green Energy Index Fund (NASDAQ: QCLN ), which tracks the performance of the Nasdaq Clean Edge Green Energy Index , is a collection of energy producers, developers, distributors and/or installers. Technologies. The stock has fallen 33% in the past year.
Another ETF is the Invesco Solar ETF (NYSEARCA: TAN ), which, as the name suggests, invests in companies involved in solar energy. Its 45 stocks have fallen 45% in the past year.
Finally, the iShares Global Clean Energy ETF (NYSEARCA: ICLN ), the largest clean energy ETF with net assets of $2.55 billion, invests in global stocks operating in the clean energy space. Shares have fallen 33% over the past 52 weeks.
Together, these three ETFs own 206 securities. I recommend one of the three ETFs. The only problem? They must be green energy stocks recognized by analysts.
First Solar Lamp (FSLR)
Source: Igor Golovniov / Shutterstock.com
First Solar (NASDAQ: FSLR ) is the second largest QCLN stock. It is a solar panel manufacturer based in Arizona. There are 31 analysts covering the stock. Of these, 25 is Outperform Buy, with a price target of $227.00, representing a 53% upside from the current share price.
As with many companies in the green energy sector, matters are becoming increasingly uncertain, leading to forecast corrections. But when First Solar reported its third-quarter 2023 results in late October, the company pegged its 2023 net income at $3.5 billion, halfway through its guidance, with operating profit rising $12 million to $820 million.
"Since our last earnings release, we have made continued progress in laying the foundation for our long-term growth trajectory, including investments in the manufacturing and infrastructure necessary to rapidly develop and scale our technology," said Mark Widmar, CEO of First Solar .
In October 2020, I selected First Solar with nine stocks riding the wave of ESG (environmental, social and governance) investing. Well, ESG criteria are now forgotten.
But like I said, First Solar recycles 90% of the glass and semiconductor material from its solar panels. ESG or not, this is responsible manufacturing.
Shoals Technologies Group (SHLS)
Source: Chuyuss / Shutterstock.com
Sholes Technologies Group (NASDAQ: SHLS ) is TAN's fifth largest holding company. It is a Tennessee-based manufacturer of electrical balancing systems ( EBS ) that provides solutions for electrical projects. Basically, EBOS devices transport electrical power from the solar modules to the inverter, which converts direct current ( DC ) into alternating current ( AC ). The green electricity is then fed into the power grid.
Of the 18 analysts covering the stock, 15 rate it a Buy, with a price target of $24.00, representing a 77% upside from the current share price. Scholes shares have lost 52 percent over the past year and 60 percent over the past five years. This is for recovery.
In October, analysts at Goldman Sachs upgraded the stock to "Buy" from "Neutral" while raising their price target to $28 per share. Analysts explained that there were three reasons for this update. First, margins are expected to improve as warranty cost issues are resolved. Second, solar growth in the United States is expected to be very strong by 2024. After all, valuations were at historic lows and trading at 20x earnings per share.
Since then, shares have lost 23% of their value. In 2024, based on the average analyst estimate of $0.90, the stock now trades at 15 times earnings, even cheaper than in the fall.
This is a long-term purchase.
EDPI Energies of Portugal (EDPI)
Source: Shutterstock
EDPEnergias de Portugal (OTCMKTS: EDPFY ) is ICN's seventh largest holding company. There are 21 analysts covering the stock. Of these, 19 is outperform buy, with a price target of $59.77, 29% above the current share price.
As the name suggests, it is an energy company founded 40 years ago as a utility company in Portugal. The aim is to produce 100% green electricity by 2030, i.e. in just six years. With 85% renewable energy, we are not far from this milestone.
For the first nine months of 2023, EBITDA was €3.83 billion ($4.17 billion), up 25.6% from €3.05 billion ($3.32 billion).
The company's 2023-2026 growth plan says it plans to invest 25 billion euros ($27.21 billion) over four years, adding 4.5 GW (gigawatts) a year and more than 50 GW between 2021 and 2030 to extract coal from to call 2025, all green by 2030 and net zero emissions by 2040.
Based on this, the company aims to increase EBITDA to 5.7 billion euros ($6.2 billion) by 2026, which will increase net profit to $1.45 billion ($1.58 billion).
He has ambitious plans for green energy. I hope it serves its purpose of rewarding shareholders for their faith and patience.
At the time of publication, Will Ashworth has no opinion about the warranties (express or implied) contained in this article. The opinions expressed in this article are those of the author in accordance with InvestorPlace.com's publication guidelines.
Will Ashworth has been writing full-time about investing since 2008. His publications include InvestorPlus, Motley Fool Canada, Investopedia, Kiplinger and many others in the United States and Canada. He especially enjoys creating model portfolios that will stand the test of time. He lives in Halifax, Nova Scotia.
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