The Top 10 Clean Energy Stocks For 2021 - An Oilprice.com Exclusive Report - Oil Price
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The Top 10 Clean Energy Stocks For 2021 An Oilprice.com Exclusive Report
The State of Mind This is where it all moves from pure enthusiasm to market reality … We’ll talk about the great transformation …. the clean energy revolution and its myriad catalysts that are all lining up simultaneously for true growth potential … but the key to investing in renewable energy requires a state of mind that is rather more modern that many investors tend to be. Betting on renewable energy isn’t about crunching profit numbers and counting everything that comes off the assembly line. It’s not always about fundamentals—yet. It’s a leap of faith, and one that stands to be extremely rewarding for investors willing to hedge on a grand idea … not a balance sheet. And in this case, the “grand idea” is indeed … grand. It was already riding some serious tailwinds prior to the global pandemic. Then it shifted into overdrive and we are convinced it will remain there. Tesla should have painted a clear enough picture of how the “modern” way of thinking goes—and how much it can be rewarded. The world is changing. As investors, we can change with it and even stay ahead of it by investing in stocks that represent our energy future rather than our energy past. Alternatively, we can plod along with marginal rewards for steadfastness. Again, it’s a state of mind, and the stocks we will be examining in this report largely—but not exclusively--fall into the “modern” state of mind: Major potential growth rather than presently sound fundamentals. The Top 10 Clean Energy Stocks For 2021 2
The State of Play The transformation of our energy systems from reliance on high-carbon fuels like oil, coal and gas towards carbon-neu- tral energy sources such as wind, solar and geothermal heat is well and truly underway. Renewable power is booming, as innovation brings down costs and drives the electrification of large sectors of the economy such as transport and heating. A November HYPERLINK “https://www.iea.org/reports/renewables-2020”IEA report found that almost 90% of new electricity generation in 2020 was renewable, with just 10% powered by gas and coal. The Top 10 Clean Energy Stocks For 2021 3
The International Energy Agency has predicted that green electricity will end coal’s 50-year reign by 2025. Even Big Oil is on board … The inexorable march of renewables has continued to gather momentum during the ongoing pandemic, with renewable energy emerging as the energy sector most resilient to Covid19 lockdown measures. Clean energy investors have been making money hand over fist, as investors continue to snap up the iShares S&P Global Clean Energy Index ETF (NASDAQ:ICLN)--a catch-all bet on clean energy. The slim majority the Democrats have won in the Senate is likely to enhance President-elect Joe Biden’s chances of fulfilling his pledge to promote clean energy and EVs though sweeping legislation, such as his $5-trillion climate plan, are still on ice. ICLN, a fund that offers broad exposure to companies that produce energy from renewable sources, has racked up handsome gains to the tune of 178% over the past 12 months. ICLN’s top three holdings are Plug Power (NAS- DAQ:PLUG), Enphase Energy (NASDAQ:ENPH) and Meridian Energy (OTC:MDDNF), which speaks volumes about where things are headed. With this in mind …. The Top 10 Clean Energy Stocks For 2021 4
The TOP 10
Renewable Energy Stocks For 2021
#1
The company’s renewables unit, NextEra Energy Re-
sources, is the largest generator of wind power in North
America, generating 42,807,582 MWh of wind power in
NEXT ERA ENERGY 2019 and another 7,059,936 MWh of solar.
NextEra has also drawn up plans to develop Wall Street’s
latest renewable darling: Hydrogen.
During its second quarter earnings call, NextEra’s CFO
Rebecca Kujawa said the company is “...particularly ex-
cited about the long-term potential of hydrogen” and dis-
cussed plans to start a pilot hydrogen project at one of its
generating stations at Okeechobee Clean Energy Center
owned by its subsidiary, Florida Power & Light (FPL).
Over the past 15 years, the world has been rapidly shift-
ing to cleaner electricity, and few, if any, companies have
Jumping in on NEE a decade ago would have
navigated this transition in the U.S. better than Flori-
da-based utility giant, NextEra Inc. (NYSE:NEE). meant a 520% return today, blowing away
pretty much any mainstream energy offering.
NextEra has grown into the largest electric utility not
only in the U.S. but the entire world, thanks to its for-
ward-thinking management that has wisely deployed the Every step of the way, NextEra seems to have been
company’s stable cash flows from its regulated Florida ahead of the game, and that’s been very rewarding for
investors throughout 2020. We see even more catalysts
power utility (70% of revenue) to help into renewable in-
ahead for 2021.
vestments (currently 30% of revenue).
If you had invested in NEE stock a decade ago, you
would be sitting on 520% return--a truly phenomenal
return for an energy company.
By contrast, a similar investment in ExxonMobil Corp.
(NYSE:XOM) you have seen your investment lose 25%
after factoring in dividends.
NextEra’s dividend (currently yields 1.73%) is considered
as safe as investment-grade bonds.
The Top 10 Clean Energy Stocks For 2021 5
While NextEra ranks #1 on our list of renewable energy space, Tesla Inc. (NASDAQ:TSLA), has been running
stocks for 2021, adding an alternative that hasn’t already amok, with TSLA stock up nearly 800% over 52 weeks,
shot through the roof isn’t a bad idea, either … giving the EV maker a market cap of $834 billion as of the
second week of January 2021.
Alternative Buy: Algonquin Power &
Utilities Corp. Tesla appears to have earned its stripes, though—even if
plenty would still disagree, and even though short-sellers
With a P/E GAAP (TTM) of 40.98 against a sector median have consistently lost on this one.
of 20.60, NEE stock is decidedly expensive.
Value investors searching for a comparable but cheaper al- Tesla short-sellers lost a collective
ternative might want to consider Algonquin Power & Util-
$40 billion in 2020 ...lesson learned?
ities Corp. (NYSE:AQN) with P/E GAAP (TTM) of 21.20.
Algonquin Power owns and operates a portfolio of elec- For years, naysayers and short-sellers like Citron Re-
tricity generation, distribution, and transmission utility search were willing to bet the house that Elon Musk’s
assets in the United States and Canada and the United high-wire act wouldn’t end well, with the preordained de-
States. It generates and sells electrical energy through nouement being a bankruptcy or a sale.
non-regulated renewable and clean energy power gener-
ation facilities. And just like its bigger peer, the utility has
been rapidly expanding its renewable generation portfolio But those speculations were short-lived: Tesla and Musk
including hydroelectric, solar, wind, and thermal facilities. quickly proved to the world that there’s robust demand
for EVs and the future truly is electric.
In December 2020, Algonquin Power agreed to acquire
a 50% stake in a portfolio of four wind facilities in Texas
with an aggregate capacity of 861 MW from RWE Group
(OTCPK:RWEOY) at price corresponding to an enterprise
value of ~$600M.
#2
Tesla
The company has lately been defying bearish expecta-
tions that historically low oil prices would weaken its val-
ue proposition as it seeks to displace the internal com-
bustion engine.
With the electrification drive in full swing, the EV sector
has lately been sizzling hot. The de facto leader of the Tesla has continued to beat delivery estimates, thanks
The Top 10 Clean Energy Stocks For 2021 6
to injecting its large-scale manufacturing capabilities into 1M deliveries as early as 2021.
Musk’s inspired improvisation. Tesla is now looking to
deliver an astounding 1 million EVs in 2021, double the Biden has unveiled a plan to build 500,000 new EV
1M tally for 2020. charging stations, a move that could spur sales of ~25M
EVs in the coming years. Tesla will no doubt be one of the
In its latest shareholder letter, Tesla revealed that its Fre- biggest beneficiaries of that government largesse.
mont, California factory can churn out 500,000 Model 3 +
Y units and another 90,0000 Model S + X units per year.
Tesla’s parabolic rally and apparent overvaluation does
not appear to deter Wall Street, with Bank of America re-
Meanwhile, Tesla’s new Shanghai factory has ramped up cently assigning a new price objective of $900 to TSLA,
capacity at an incredible clip and now has the capacity good for 8.5% upside.
for 250,000 Model 3 vehicles annually. Adding that up
brings us to Ferragu’s lowball estimate of 840,000 deliv-
The alternative could potentially be exciting, too …
eries in 2021.
Alternative Buy: Fisker
But Tesla has a number of other gigafactories in the pipe-
line, which could significantly increase its production ca-
pacity as the quarters roll on: A Model Y factory in Austin,
Texas and a similar one in Berlin, Germany, with both
under construction. Meanwhile, the company is adding a
Model Y production line at its Shanghai factory.
At 23X EV/sales and 118x EV/EBITDA, Tesla’s valuation is
hard to wrap your head around...even for diehard bulls.
Fisker, Inc.(NYSE:FSR), a company that designs and
manufactures electric vehicles and mobility solutions,
could reward investors with the same phenomenal re-
turns that early Tesla investors have enjoyed.
Fisker Inc. is the relaunch of the Fisker brand that was
founded by Henrik Fisker in 2007.
Although Tesla has repeatedly missed deadlines in the
past, the Shanghai plant was built and began vehicle as- In addition to designing and developing EVs, Fisker has
sembly in just under a year. filed patents pertaining to solid-state battery technology
for use in automotive and consumer electronics. How-
The bulls are, therefore, betting that two upcoming fac- ever, at this juncture, Fisker remains a speculative play
tories and the new Model Y plant in Shanghai will be since it won’t start production of EV SUVs until 2023, and
completed before the end of the year and possibly ramp probably won’t start making serious cash until late 2021
up capacity rapidly enough for Tesla to hit the magical on advance orders.
The Top 10 Clean Energy Stocks For 2021 7
Does that sound familiar?
It should.
It’s reminiscent of the early Tesla story in many ways.
Fisker stock has made a giant leap over the past month
after Citi Group initiated coverage on the company with
a $26 price target. FSR stock has gained 44.2% in the
year-to-date and now boasts a $4.1B market cap.
Fisker has four long-term advantages here:
• It’s making an SUV (a strong segment)
Goldman Sachs has initiated Fisker with a ‘Neutral’ rat-
• It’s got a strong brand and it’s got automotive design ing and a $15 price target, noting the world-class design
legacy with Henrik Fisker.
talent at the firm but holding back due to the anticipated
• It’s a massive saver of capital because it has an inno- length of time before products arrive. Still, this could turn
vative “asset-light” approach, getting Magna Interna- out like Tesla’s early days...meaning incredible profits for
tional to assemble its first vehicle. early-in investors willing to play the long game.
• It’s also taking EVs to a new level: Fisker’s Ocean SUV
isn’t just an EV, it’s made from recycled materials. We can wait.
#3
Fisker has already garnered 9,000 pre-orders … fully pre-
paid. And when it does come out with its first Ocean SUV,
it will be at an affordable $40,000 price point and a super
flexible lease set-up that could be incredibly disruptive… Enphase
The rather long wait before its first EVs start rolling off Enphase Energy Inc. (NASDAQ:ENPH) is a Fremont,
production lines has some analysts sitting on the side- California-based company that designs and manufac-
lines, though. tures software-driven home energy solutions used in
The Top 10 Clean Energy Stocks For 2021 8
solar generation, home energy storage and web-based Despite all of this, Wall Street’s verdict on ENPH is a
monitoring and control. mixed bag.
A big reason why ENPH stock is up 570% in 12 months Raymond James and Susquehanna have recently down-
and 6,840% in five years is because the company oper- graded the stock with Raymond James analyst Pavel
ates in the most profitable segment of the solar supply Molchanov labeling the maker of solar inverters as a
chain: Smart Inverters and Battery Storage. “textbook example of overly euphoric sentiment.”
Susquehanna’s alternative energy analyst Biju Perincher-
Enphase is up 570% in 12 months il has also downgraded ENPH to Neutral from Positive,
and over 6,800% in five years, and citing stretched valuations. Perincheril has assigned new
it’s solidly profitable price targets of $195 for ENPH, suggesting 6% down-
side.
Both these products require higher levels of innovation Not everybody has bailed on Enphase, though. Goldman
and thus offer more room for a company like Enphase to Sachs has upgraded the stock, citing a shifting prefer-
showcase its superior IP. ence toward residential solar and battery exposure.
Enphase is regarded as one of the leaders in smart in- Overall, ENPH still carries a Buy rating on The Street
verters which allows its products to command premium though the consensus price target of $132.46 suggests
prices. For instance, ENPH recently unveiled a strategic a potential 34.3% downside.
partnership with solar module manufacturer Sonnen-
stromfabrik to develop the first high-efficiency Enphase Alternative Buy: SunPower Corp.
Energized AC module for the European residential solar
market.
Sunpower Corp.(NASDAQ:SPWR) is an American ener-
gy company that manufactures crystalline silicon photo-
In fact, Enphase is one of a handful of solar companies voltaic cells and solar panels based on an all-back-con-
that can boast of being solidly profitable, with a gross tact solar cell technology.
margin comfortably north of 40%--about 10 percentage
points higher than its closest peer SolarEdge Technol- SunPower is an old head in the solar industry and has
ogies Inc. (NASDAQ:SEDG). tried its hand at many aspects of the business.
The Top 10 Clean Energy Stocks For 2021 9
However, the company’s latest act involves becoming a if Biden repeals Section 201 tariffs that Trump placed on
more specialized player in solar technology, after selling its imported solar modules from China, while Morgan Stan-
microinverters business to Enphase in 2018 and completing ley and J.P. Morgan have downgraded the stock after its
the acquisition of Maxeon (NASDAQ:MAXN) last August. recent run-up to multiyear highs (FSLR is up 67.2% YTD).
A key benefit of this strategy has been a reduction in Sun-
Power’s cost of capital and a healthier balance sheet. It’s
too early to tell whether SunPower’s streamlining efforts
will pay off in the long run but if you love a good turn-
around story, this company might be a good buy.
#4
First Solar
Nevertheless, FSLR remains fundamentally sound and a
top player in the industry.
During the latest earnings, the company reported Q3 rev-
enue of $928M (+69.7% Y/Y) and GAAP EPS of $1.45,
both metrics easily beating Wall Street expectations.
More importantly, FSLR has a stronger balance sheet
First Solar (NASDAQ:FSLR) IS America’s largest solar than most of its peers, with an impressive current ratio
manufacturer and the third-largest in the world with rev- of 3.66 compared to 1.04 by JinkoSolar (NYSE:JKS),
enue (TTM) of $3.1 billion. 1.14 by Canadian Solar (NASDAQ:CSIQ) and 0.47 for
Daqo New Energy (NYSE:DQ).
First Solar manufactures solar panels, photovoltaic pow-
er plants, and related services including construction, Alternative Buy: SunRun
maintenance, and recycling of solar products. The Tem-
pe, Arizona-based company employs thin film semicon- Sunrun Inc. is a United States-based provider of resi-
ductor technology to achieve enhanced efficiency and dential solar electricity, headquartered in San Francisco,
sustainability in its solar modules. California.
First Solar has been removed from Goldman Sachs’ Con- Back in July, Sunrun announced that it would acquire
viction List mainly due to lower exposure to fast-growing rival Vivint Solar (NYSE:VSLR), in an all-stock deal val-
solar markets in China, India and Asia (75% of the com- ued at $3.2B including debt. Sunrun sealed the deal in
pany’s orders come from the U.S.). October, with management guiding for cost savings of
$90 million thanks to synergies created by the merger.
Others, such as Raymond James have moved to the side-
lines on fears that First Solar might come under pressure The merger created a behemoth with about 500K cus-
The Top 10 Clean Energy Stocks For 2021 10tomers, beating Tesla Inc.’s (NASDAQ:TSLA) residential Based in Guelph, Canada, Canadian Solar is currently
solar business in scale and easily making it one of the ranked as the fifth-largest solar PV manufacturer in the
world’s largest providers of solar equipment. world by volume with nearly 10GW of panels produced
in 2019 and one of the ‘most bankable’ manufacturers.
A $3.2-billion merger of Sunrun and rival Like many solar names, CSIQ has enjoyed a banner year,
Vivint Solar creates a behemoth worth climbing 149% over the past 12 months. However, the
keeping a close eye on in 2021 and beyond company appears to have room to run thanks to contin-
ued macro tailwinds support including vertical integra-
tion, module capacity expansion as well as a growing
and stabilizing project development business. Further,
According to UBS Research, Tesla was the leader of the
the company has considerable upside potential thanks
residential solar space in 2019, accounting for 14% of
to its position as an early mover in the development of
all U.S. residential solar installations thanks to its 2016
utility-scale energy storage projects.
acquisition of SolarCity. The Sunrun-Vivint Solar combo
will, however, now top that with a 16% slice of the market.
CSIQ gained nearly 150% in 2020 and
Jinjoo Lee of the WSJ says the larger scale of the new
there’s still room to run for this early mover
entity might eventually help tackle Sunrun’s “soft costs”
such as customer acquisition costs, labor and permits.
But, perhaps, best of all, CSIQ remains cheaper than
most of its peers probably because it’s been growing at
#5 a slower but steady pace.
Canadian Solar Alternative Buy: SolarEdge
SolarEdge Technologies Inc. (NASDAQ:SEDG) is an
Israel-based provider of power optimizers, solar invert-
ers and monitoring systems for solar PV systems. The
company has demonstrated strong revenue momentum,
posting 42% CAGR over the past three years.
SEGD stock has surged 237% over 52 weeks as the mar-
ket continues to reward it for a successful transition from
a manufacturer of solar inverters to a vertically integrated
distributed energy business.
Canadian Solar (NASDAQ:CSIQ) manufactures solar
PV modules and runs large scale solar projects through SolarEdge’s current suite of solutions includes grid ser-
two segments, Module and System Solutions (MSS), and vices, energy storage, and energy management. Al-
Energy. The company’s energy solution products include though the majority of these solutions are built around
solar inverters and energy storage systems. the company’s legacy inverter and power optimizer prod-
The Top 10 Clean Energy Stocks For 2021 11ucts, they are still relatively newer solutions that expand which appears like a fairly valued deal considering MHI
the company’s addressable market. Vestas has annual revenue of approximately EUR 1.4 B.
Last year, B. Riley initiated coverage of SolarEdge with a
‘Buy’ rating, saying the company is “best positioned play- Offshore wind is just picking
er to address multiple end markets and geographies with up speed globally, and Vestas is
improved functionality and competitive pricing on the resi- well-positioned to benefit in 2021,
dential side and with new products to address larger proj-
but watch the tie-in to the hydrogen
ects in the commercial and utility-scale segments.”
boom, as well
#6 Offshore wind is just taking off globally with installed ca-
pacity expected to increase sharply in the second half of
Vestas the current decade.
MHI Vestas has 3.9 GW in firm orders now and another
1.3 GW of conditional orders, a nice addition to Vestas’
16.2 GW backlog and 118 GW installed capacity.
Vestas and Mitsubishi have also agreed to collaborate on
green hydrogen production which makes sense now that
a consortium of European energy giants have vowed to
bring down green hydrogen prices to $2/kg over the next
couple of years.
Vestas Wind Systems (OTCPK:VWDRY) is the world’s
largest wind power company, responsible for more wind
turbine installations than any other company, estimated
at 70,000 turbines in 80 countries. Apart from the tur-
bines, this Denmark-based company services more than
40,000 turbines and delivers approximately 800,000
wind turbine parts annually.
Whereas Vestas is the undisputed global leader in on-
shore wind, the company is now making decisive steps On the other hand, the hydrogen boom is likely to provide
to also take the lead in offshore wind. a significant boost to renewable energy in some sort of
virtuous cycle by creating substantial investment oppor-
The company has agreed to acquire Mitsubishi’s 50% tunities for solar and wind energy, the scaling of which
stake in offshore segment MHI Vestas for EUR 709 mm could lower hydrogen production costs even further.
The Top 10 Clean Energy Stocks For 2021 12Alternative Buy: American Supercon- standard low-pressure natural gas, biogas, or hydrogen
ductor Corp. into electricity through an electrochemical process with-
out combustion.
American Superconductor Corporation (NAS-
DAQ:AMSC) is a Massachusetts-based provider of
megawatt-scale power resiliency solutions to global cus-
tomers.
The company’s Wind segment designs wind turbine sys-
tems and licenses them to third parties under the Wind-
tec Solutions brand and also supplies power electron-
ics and software-based control systems to wind turbine
manufacturers. Adding more fuel to the fire, so to speak, back in June,
Bloom announced plans to enter the commercial hydro-
The Grid segment offers products and services to elec- gen market by introducing hydrogen-powered fuel cells
tric utilities that help them connect, transmit, and dis- and electrolyzers that produce renewable hydrogen.
tribute power their renewable power under the Gridtec
Solutions brand.
After a stagnant period, AMSC has been able to return to
growth, posting 50% revenue growth over the last quar-
ter. The company is expected to continue doing brisk
business with its topline expanding 40% over the next
two years.
The timing could not have been better, with the hydrogen
AMSC has an Overweight rating with 3 ‘Buy’ ratings and sector on the verge of taking off and costs expected to
1 ‘Hold’ rating. fall dramatically.
#7
The Green Hydrogen Catapult Initiative is a brainchild of
founding partners Saudi clean energy group ACWA Pow-
er, Australian project developer CWP Renewables, Euro-
Bloom Energy pean energy giants Iberdrola and Ørsted, Chinese wind
turbine manufacturer Envision, Italian gas group Snam,
and Yara, a Norwegian fertilizer producer.
Bloom Energy Corp. (NASDAQ:BE) was one of the
most exciting stocks of 2020.
The real game-changer herewill be
It’s a clean energy innovator that designs, manufactures,
success in driving 25GW of green
and sells solid-oxide fuel cell systems for on-site power
generation. It’s key product, the Bloom Energy Server, hydrogen production by 2026.
is a stationary power generation platform that converts
The Top 10 Clean Energy Stocks For 2021 13The companies hope to drive 25GW of green hydrogen Perhaps it’s not a coincidence that the stock has been
production by 2026, a scale that could significantly drive rallying hard in the five weeks since Biden was declared
down hydrogen costs to below $2/kg thus making the the next president of the United States. With Biden
fuel source competitive with fossil fuels in power gener- pledging net-zero status by 2050 and looking to invest
ation. Green hydrogen is produced using renewables as nearly $2 trillion of Federal funds in clean energy if the
an energy source in the electrolysis of water. Democrats win the senate majority, the hydrogen sector
has good reason to be excited about what’s to come.
Its late entry into the hydrogen market might allow BE to
ride the hydrogen wave at a profitable phase compared Still, FuelCell has managed to make a strong case for
to legacy companies that have printed red ink for many the role its fuel cells could play in building microgrids by
years. highlighting how California utility regulators recently man-
dated Public Service Power Shutoffs (“PSPS”) in an effort
So far, the clean energy wave has been extremely kind to avert wildfires led to widespread blackouts, hardship,
to Bloom investors. For 2020, investors saw gains of over economic loss, hardship, and other more serious conse-
260%, with cautionary salvos that have lately slowed quences.
those gains due to concerns of over-hyping hydrogen
and overvaluation. We think it’s still a smart play with
#8
plenty of potential upside, but don’t necessarily expect a
repeat of 2020 in 2021. We might have to look a year or
two beyond that to see what Bloom can really do.
Brookfield Renewable
Alternative Buy: FuelCell Energy Partners
Source: CNN Money At a time when energy MLPs (Master Limited Partner-
ships) are mostly struggling, it comes as a breath of fresh
On the opposite side of the spectrum, FuelCell Energy air to find one that is really flying.
Inc.(NASDAQ:FCEL) has surged more than 628% over
the past 90 days alone and 62% YTD in what analysts Brookfield Renewable Partners LP (NYSE: BEP) is
are calling a classic FOMO (Fear Of Missing Out) trade. an MLP that owns a portfolio of wind, solar, hydroelectric
The Top 10 Clean Energy Stocks For 2021 14and other green-energy properties. BEP has surged 85% ICLN’s top 5 holdings in order of weightings are:
over the past 12 months and 10.3% YTD.
• PlugPower--6.18%
Recently, Plug Power (NASDAQ:PLUG) announced an
agreement to source 100% renewable energy supplies • Enphase Energy--5.47%
from Brookfield Renewable Partners to fully energize its
planned green hydrogen production plant, one of the first • Meridian Energy--5.13%
industrial-scale facilities in North America.
• Xinyi Solar--5.08%
We’ve talked about the hydrogen • Verbund AG--4.79%
tie-in in several of these stocks,
ICLN invests in both growth and value stocks across di-
and while it serves investors well
versified market capitalization, thus offering excellent ex-
to avoid getting caught up in hype, posure to the global renewable energy ecosystem.
the market IS projected to hit $11T
in the next three decades, and BEP
is throwing its hat in the ring.
#9
Plug Power
The hydrogen sector is one of the hottest corners of the
New York-based PlugPower Inc. (NASDAQ:PLUG) en-
renewable energy sector right now with the hydrogen
gages in the development of hydrogen fuel cell systems
market projected to hit $11 trillion over the next three de-
cades. that replace conventional batteries in equipment and ve-
hicles powered by electricity, such as forklifts.
This makes Brookfield Renewable Partners LP-- a
60%-owned renewable-energy affiliate of Brookfield PLUG has soared to its highest levels since the 2008 fi-
Asset Management--one of the best stocks to own un- nancial crisis, boasting an imperious 1,200% return over
der a Joe Biden presidency. the past year and 60% already in the new year.
Alternative Buy: ICLN A cross-section of Wall Street is worried that hydrogen
stocks like PLUG could be in a serious bubble especially
considering that many companies in the space are still
The $5.5 billion (AUM) iShares Global Clean Energy
printing red ink.
ETF (ICLN), a catch-all bet on clean energy, is the renew-
able energy sector’s largest ETF. Owned and managed
by BlackRock, ICLN invests in global stocks of compa- Still, investors cannot seem to get enough of the com-
nies operating across utilities, solar energy, wind alter- pany--which is partly justifiable given PlugPower’s bright
native energy resources, hydroelectric power generation, prospects. After growing its topline 28% in 2020 amid
biofuels, independent power and renewable electricity the pandemic, PlugPower is expected to record a 38%
producers sectors. revenue improvement in the current year to $410M.
The Top 10 Clean Energy Stocks For 2021 15tures and sells proton exchange membrane fuel cell
products. The company offers fuel cell stacks, heavy
duty modules, and portable power/ unmanned aerial ve-
hicles (UAV), backup power systems, and material han-
dling products.
Just like its peer, Ballard Power has been striking strate-
gic partnerships and bagging big deals.
Source: Seeking Alpha
Back in December, the company received follow-on
Just two weeks into the New Year, and PlugPower has al- purchase orders from Van Hool, for fuel cell modules to
ready completed two important pieces of business: a $1.5B power Van Hool’s hydrogen buses under the JIVE2 fund-
strategic investment from South Korea’s SK Group as well ing program.
as a 50-50 joint venture with French automaker Renault.
In early January, Ballard Power received purchase or-
Under the SK deal, the Korean company will acquire ders by U.K.-based Arcola Energy, to supply fuel cell
~51.4M common shares at ~$29.29/share, representing modules to power a demo passenger train planned for
a 9.9% pro forma ownership stake in Plug. The partner- COP26, to be hosted by Glasgow City in November 2021.
ship aims to accelerate hydrogen as an alternative ener-
gy source in Asian markets.
#10
The bulls expect PLUG will actually JinkoSolar
convert all the hydrogen hype into
concrete deliverables... so stay tuned. JinkoSolar Holding Co. (NYSE:JKS) is a Chinese solar
firm that engages in the design, production and market-
ing of photovoltaic products including silicon wafers, so-
In the Renault deal, the companies will manufacture and lar modules, solar cells, and silicon ingots. The company
sell fuel cell-powered vehicles for the fast-growing fuel also provides solar system integration services including
cell light commercial vehicles, commercial people trans- development of commercial solar power projects.
portation and taxis sectors.
Despite negative sentiment on Wall Street, JKS has con-
The bulls clearly expect that PLUG will convert the hype tinued to enjoy a strong rally on optimism that govern-
around hydrogen power into concrete orders and profits mental support for clean energy will lift all boats.
over the coming years--and so far it has not disappointed.
Alternative Buy: Ballard Power
Systems
Ballard Power Systems Inc. (NASDAQ:BLDP) is a
Canadian company that designs, develops, manufac-
The Top 10 Clean Energy Stocks For 2021 16dian of 5.71% while EBITDA improved 140.40% vs. 4.50%.
For the current year, DQ has projected revenue growth of
41.63% and EBITDA growth of 52.12%, much better than
the sector average of 6.96% and 8.99% for revenue and
EBITDA, respectively.
Daqo has mainly been benefiting from robust demand for
its products as well as rising polysilicon prices.
The company recently signed an agreement with JA So-
lar to supply 32,400−43,200 MT of polysilicon between
January 2021 and December 2023 and another 12,000
MT of polysilicon to a leading solar company from Janu-
ary 2021 to December 2022.
Jinko’s mid-to long-term prospects actually look good,
with solid opportunities in revenue growth and gross Daqo has a consensus Overweight rating on Wall Street
margin expansion from easing of raw material constraints with 5 Buys, 2 Buy and 1 Hold ratings.
and decreasing logistics costs.
Stick with Oilprice.com and be sure to check out the sub-
Alternative Buy: Daqo New Energy scriber-only offerings. Throughout 2021, we’ll be tracking
all of these companies to deliver in-depth insight on hype
Daqo New Energy Corp. (NYSE:DQ) is, likewise, a Chi- versus reality as the ‘green revolution’ gets underway in
nese company. In this case it manufactures monocrystal- earnest.
line silicon and polysilicon solar PV systems.
Like many of its solar peers, DQ has enjoyed a terrific run,
racking up gains of 583% over the past 12 months and is
already up 33% in the year-to-date.
But despite the massive rally, DQ still looks considerably
cheaper than ENPH with a P/E GAAP (FWD) of 39.07 vs.
271.93 as well as EV/Sales (FWD) of 8.18 vs. 32.94.
But value is just one of DQ’s attractive points.
The company has been posting impressive top-and bot-
tom-line growth--a trend that appears poised to continue
in the coming years. In the last fiscal year, Daqo posted
revenue growth of 78.3% Y/Y, compared to a sector me-
The Top 10 Clean Energy Stocks For 2021 17You can also read
