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Canadian Renewable Resources: Invest in Green Energy for a Sustainable Future

A lake in the shape of a solar, wind and energy storage system in the middle of a lush forest as a metaphor for the concept of clean and organic renewable energy.
Source: Getty Images

Written by Amy Legate-Wolfe at The Motley Fool Canada

Whether you’re on board with the transition to green energy or not, it cannot be denied that this is exactly where future riches lies. The entire industry was worth US$1 trillion in 2022, and is estimated to reach US$1.5 trillion by 2028.

The pace continues to accelerate as more and more governments dedicate resources to the growth of renewable energy. The demand is evident, as we saw exactly the reason why countries should focus on creating renewable resources when Russia invaded Ukraine.

This invasion led to European countries placing sanctions on Russia, pushing them away from dependence on Russian fossil fuels. Now, countries more than ever want to create their own power rather than depend on it from some other source.

When it comes to a green energy future then, there is a lot of wealth to be made. Let’s look at three green energy stocks that could see those riches come sooner rather than later.

Brookfield Renewable Partners LP

Probably my favourite of the green energy stocks is Brookfield Renewable Partners LP (TSX:BEP.UN). This diverse renewable energy company has been around for over a decade, yet its parent company has been in renewable energy since the late 1800s.

It now operates around the world, and in every type of renewable energy asset. What’s more, BEP.UN is undervalued right now. Shares are down 19% since hitting 52-week highs as of writing. It trades at 1.7 times book value and offers a dividend yield at 4.49% as of writing.

Shares of Brookfield stock certainly have long-term potential, something it has already proven over the last few years. The stock is up 346% in the last 20 years, and doubled in the last five. Yet, this company could just be starting to ramp up as it continues to find more opportunities and partnerships to invest in.

Ballard Power

Now getting a bit more narrow, there are other areas of green energy stocks that investors should have in mind. Ballard Power Systems (TSX:BLDP) is certainly one to consider in this case. Its proton-exchange membrane provides fuel cell and power system development to companies and indeed countries around the world.

These fuel-cell products are used to power the heavy-duty systems out there. They include buses, marine operations, and even rail. Yet supply-chain issues have hit the stock over the last few years, as well as the shift away from green energy stocks.

Now, Ballard stock trades at a valuable 1.5 times book value, with shares down 31% in the last year, and 10% year to date. After hitting all-time highs when President Joe Biden came to office, those shares have crashed back to where they were in 2019. When there is more movement in the future, investors may see their shares surge once more, especially from a company that’s been in this sector for the last 44 years.

Magna stock

Finally, we have what you may have been waiting for. An electric vehicle company for the transition to green energy stocks. Undeniably, in the next decade or so pretty much every new car out there will be an electric vehicle.

Again, it’s clear why. These provide a clean energy option for the future. Plus, they’re also cheaper to run and even cheaper to fix (hello, no engine!). And a company that’s into this transition in a big way is Magna International (TSX:MG).

Magna stock has been a strong choice for those seeking exposure to the electric vehicle transition, but without investing in just one car manufacturer. This company instead provides parts and assembly across the board to many of these manufacturers. The big problem remains that Magna stock continues to deal with supply-chain disruptions as inflation puts pressure on the stock.

Even so, this is likely to subside once we’re out of an economic downturn. Magna stock has already seen positive movement recently. Shares are down 3.5% in the last year, and 8% year to date. But MG enjoyed a 7.5% jump last week after reporting sales were up 11% year over year. Plus, you can grab a 2.47% dividend yield right now.

The post Canadian Renewable Resources: Invest in Green Energy for a Sustainable Future appeared first on The Motley Fool Canada.

Should You Invest $1,000 In Brookfield Renewable Partners?

Before you consider Brookfield Renewable Partners, you'll want to hear this.

Our market-beating analyst team just revealed what they believe are the 5 best stocks for investors to buy in April 2023... and Brookfield Renewable Partners wasn't on the list.

The online investing service they've run for nearly a decade, Motley Fool Stock Advisor Canada, is beating the TSX by 21 percentage points. And right now, they think there are 5 stocks that are better buys.

See the 5 Stocks * Returns as of 4/18/23

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Fool contributor Amy Legate-Wolfe has positions in Brookfield Renewable Partners. The Motley Fool recommends Brookfield Renewable Partners and Magna International. The Motley Fool has a disclosure policy.