A quick rundown of the best green energy stocks to invest in this year
Green energy is no longer an abstract thought in people's minds that is only ever brought up in the news. Now, it is a real and palpable demand that the market is quickly mobilizing to mean. A shift has already begun and large chunks of the world's population are already living with and using green energy for their day to day needs. It's no longer a question of whether or not green energy will replace fossil fuels, but when we can expect to see the transition complete.
That being said, we still have a long way to go before the majority of our energy is obtained through renewable sources. Though for the planet, the change cannot come faster, for the investors this presents a set of opportunities that one can profit from.
The 7 Best Green Energy Stocks This Year (So Far)
Investing in green energy now, while it's still in the early stages of implementation, can provide you with a great source of long-term investment -- essentially banking on the future growth of the green energy market and the profits it will rack up. That's why we have compiled for you this list of the 7 best stocks to invest in for you to cash in on the growing green market.
1. NextEra Energy Partners, LP (NYSE: NEP)
Market Value: $5.64 Billion
Operating mainly out of the USA, NextEra is a green energy utility company with a portfolio of assets that includes solar and wind projects, among others. Based in Florida, the company is relatively new, only being incorporated in 2014, but has since gone public with some promising results.
Stock prices have gained 23.32% over the past twelve months and have consistently grown by 137.91% over the past 5 years. Income investors would also be happy to know that the stocks of NextEra can serve as passive income. This is because of its healthy dividend yield of 3.43%.
There are currently 63 hedge funds investing in the company. Their combined stake value amounts to roughly about $2.72 billion.
2. Xcel Energy Inc. (NASDAQ: XEL)
Market Value: $36.74 Billion
This is an electric services company based in Minneapolis, Minnesota, and was founded in 1999. The company is one of the pioneers of green energy and offers a wide array of renewable and clean energy sources. It mainly derives and distributes electricity made from hydroelectric, solar, biomass, and wind. From here, their portfolio diversifies further as Xcel also develops and leases natural gas pipelines and storage and compression facilities.
In May of this year, the company delighted investors with an announcement of a quarterly dividend of $0.46 per share. The stocks have also gained 6.92% in the past 6 months and 5.91%. Sales for the company are also doing quite well with a reported $3.54 billion and $364 million in revenue and earnings respectively. These numbers beat many analysts' estimates and marked a rebounding of the company after the effects of the pandemic.
There are currently 18 hedge funds investing in the company. Collectively, their shared stake value amounts to roughly $200 million. It should be noted though that this is down from last quarter's 28 hedge funds with stakes worth $289 million.
3. Renewable Energy Group, Inc. (NASDAQ: REGI)
Market Value: $2.96 Billion
In terms of renewable car and transport fuel, the Renewable Energy Group is a major player in that market. The company mainly markets lower-carbon transportation fuels both in the US and internationally. The Renewable Energy Group also produces advanced biofuels by converting natural fats, oils, and greases -- essentially minimizing waste and carbon emissions at the same time.
The company is currently under the "Buy" rating which indicates that investors would be wise to purchase its stocks. The rating seems to be right as the company reported $539.74 million in revenue and $39.22 million in earnings for the first quarter of this year. Stocks have grown by 3.05% in the past 6 months.
There are currently 21 hedge funds investing in the company with a total stake value of $163 million. This is higher than last quarter's 16 hedge funds with a stake value of $66 million.
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4. Clearway Energy, Inc. (NYSE: CWEN)
Market Value: $5.51 Billion
Based in the US, the company is another emerging player in the green energy market and has a portfolio of district energy systems. Their thermal infrastructure assets provide steam and hot or cold water, alongside electricity, to businesses, colleges, hospitals, and others. There is also potential for even larger projects with their recent acquisition of Mt. Storm Wind Project two months ago.
The company has announced a quarterly dividend of $0.33 per share -- an increase of 1.5%. Clearway also saw a $237 million revenue in the first quarter of 2021. This is a notable drop of 8.1% year over year. Despite that, share prices beat expectations and gained 27.8% in the past year.
As of the end of the first quarter of 2021, 24 hedge funds were investing in the company with a total stake value of $232 million.
5. Vistra Corp. (NYSE: VST)
Market Value: $9.21 Billion
The operations of the Vistra Corp. are varied and, though not a green energy company from the onset, plans for a transition are being made that investors should keep an eye on. The company mainly retails electricity and natural gas to residential, industrial, and commercial areas in the US.
At the start of the second quarter of April, the company announced a dividend of $0.15 per share, making the forward yield 3.52%. This is even through the devastating winter storm which hindered some of its operations -- indicating the company's commitment to its investors. As for revenue, the company reported $3.21 in the first quarter of 2021 while stocks have gained 2.7% in the past 6 months.
46 hedge funds are investing in the company as of the first quarter. Their shared stake value amounts to roughly $1.2 billion. This is higher than the previous quarter's 39 hedge funds.
6. The AES Corporation (NYSE: AES)
Market Value: $15.92 Billion
The company is well-known as a power generation and utility company. The AES Corporation owns and operates power plants and sells the power for various uses, such as industrial production and utility provision. It derives its power from a multitude of sources which include solar, hydroelectric, and wind energy sources. It is often considered to be one of the largest and most comprehensive renewable energy companies in the world.
As of the first quarter of 2021, the company reported a revenue of $2.63 billion. This demonstrated growth of 12.4% year over year and beat estimates by $260 million. Income investors will also be happy to hear that in April, the company announced a quarterly dividend of $0.15 per share, making the forward yield stand at 2.13%. The stocks have generally fared better in the long-term with gains of 21.5% in the past 6 months and 11.36% year to date.
As of the first quarter of this year, there are 52 hedge funds tied into the company's stocks. They are investing a total stake value of about $1.54 billion. This is a sizable increase from last quarter's 38 hedge funds.
7. General Electric Company (NYSE: GE)
Market Value: $111.58 Billion
Based in Boston, the American multinational conglomerate operates in various market sectors including aviation, healthcare, power, renewable energy, digital industry, additive manufacturing, locomotives, and venture capital and finance.
As for the renewable energy sector of the company, General Electric generates its power from onshore and offshore wind, blades, hydroelectric, storage, solar, and grid solutions, among others. As such, the company is the largest on this list with a highly diverse portfolio that extends far beyond green energy generation alone.
The company reported revenues of $17.12 billion in the first quarter of 2021 -- beating market expectations. The stocks have also been performing quite well and gained 26.41% in the past 6 months and 30.75% year to date. All this has made the company be classified as "Buy" by UBS as they state an expectation for stock value to continue rising.
There are 68 hedge funds investing in the company at a whopping stake value of roughly $6.16 billion. Though these are fewer hedge funds than last quarter, the stake value in total is far more than last quarter's $5.68 billion.
And those were the 7 best stocks to invest in for green energy. If you are looking to diversify even further and invest in other Eco-friendly companies, consider the following:
We certainly hope that this article was helpful to you in making your decisions. As investors, being on top of market trends and future outcomes is simply the name of the game.
With enough research and wise investing, there is no doubt that green energy stocks will earn you a hefty return in time. In that regard, the future is indeed green.