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4 Renewable Energy Stocks to Gain in the Remainder of 2020

Zacks Equity Research
·4 min read

U.S. renewable energy space has witnessed growth for a couple of years or so led by solar and wind energy consumption for electricity generation. The story is no different amid the coronavirus pandemic.

Notably, the U.S. Energy Information Administration (EIA), in its latest Short Term Energy Outlook, has projected renewable energy to be the fastest-growing source of electricity generation for the nation in 2020. Notably, electricity generation from renewable energy sources is estimated to rise from 17% in 2019 to 21% in 2020.

Let’s delve deeper and see what’s aiding the growth of renewable energy consumption in the United States.

Factors Driving Momentum in the Renewable Energy Space

As the United States attempts to reduce its reliance on fossil fuels and transition to cleaner and cheaper energy resources, an increase in corporate investments in recent times has been boosting prospects. U.S. investments flowing into the industry totaled $55.5 billion in 2019, up 19.4% from 2018, fueled by technological advancements, grid developments and an increase in U.S. onshore wind and offshore capacities.

Furthermore, declining costs of solar panels and wind turbines along with policies, such as renewable electricity production tax credits (PTC) and preferential feed-in tariffs, and increased adoption of renewable portfolio standards (RPS) have been boosting the usage of renewable energy in recent times.

Will Renewable Space Grow in the Second Half of 2020?

Per a Deloitte report, entering into the latter half of 2020, growth in the U.S. offshore wind sector will likely open up multiple opportunities for industry players as states vie for manufacturing and port infrastructure projects. Additionally, the prospects for short-term solar and wind energy growth appear favorable, with about 96.6% of net new generation capacity additions expected to come from these two resources by the end of 2020.

Moreover, per a report by Solar Power World, hydropower, geothermal and biomass are all projected to experience net growth of 1,903 MW, 178 MW and 92 MW, respectively, in 2020, irrespective of COVID-19 impact.

4 Stocks to Look Out For

Considering the aforementioned factors and projections, let’s focus on four stocks from the renewables’ space, which are likely to gain further momentum in the remainder of 2020.

Enphase Energy ENPH had total shipments of approximately 643 megawatts DC of inverters during the first quarter. Its revenues soared 105.2% from the year-ago quarter, driven by solid shipments. It carries a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for sales in 2020 stands at $699.5 million, suggesting 12.03% year-over-year growth. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

NextEra Energy NEE reported revenues of $4,613 million in the first quarter, up 13.2% year over year. During the quarter, it added 713 MW of combined wind and repowering projects to its backlog, which reflects strong revenue growth prospects in the coming quarters. The Zacks Consensus Estimate for 2020 sales stands at $20.55 billion, indicating 7.02% year-over-year growth. It carries a Zacks Rank #2.

SolarEdge Technologies SEDG shipped a total of 1.85 gigawatts (AC) of inverters during the first quarter. Its revenues surged 59% from the year-ago quarter’s $271.9 million on solid shipments. The Zacks Consensus Estimate for 2020 sales stands at $1.5 billion, implying 5.2% year-over-year growth. It carries a Zacks Rank #3 (Hold).

Vistra Energy VST expects the integrated business model to continue to demonstrate its strength and relative stability in 2020.The Zacks Consensus Estimate for sales in 2020 stands at $13.8 billion, suggesting 16.85% year-over-year growth. It sports a Zacks Rank #1.

5 Stocks to Soar Past the Pandemic: In addition to the companies you learned about above, we invite you to learn about 5 cutting-edge stocks that could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of the decade.

See the 5 high-tech stocks now>>


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NextEra Energy, Inc. (NEE) : Free Stock Analysis Report
 
Enphase Energy, Inc. (ENPH) : Free Stock Analysis Report
 
SolarEdge Technologies, Inc. (SEDG) : Free Stock Analysis Report
 
Vistra Energy Corp. (VST) : Free Stock Analysis Report
 
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Zacks Investment Research