Alternative energy stocks need to reside every long-term-oriented investor’s portfolio for two primary reasons. First of all, alternative energy represents the fastest-growing segment within the entire energy industry. Second of all, renewable energy facilities provide stable cash flow streams that will enable the companies operating them to return a significant amount of capital to shareholders in the form of dividends. As alternative energy companies are still in the growing phase, the much-anticipated hefty dividend receipts are yet to come.
Public opinion and government support have been the main drivers of growth for the solar energy industry, with solar energy anticipated to become the fundamental source of electric power in the future. Given that global demand for electricity continues to growth, renewable energy stocks represent attractive long-term picks for investors regardless of the current economic climate. For that reason, Insider Monkey compiled a list of alternative energy stock favored by the hedge funds followed by our team, so let’s have a look at the change in hedge fund sentiment towards five high-potential renewable energy stocks.
At Insider Monkey, we track around 730 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see more details).
#5. Trina Solar Limited (ADR) (NYSE:TSL)
– Number of Hedge Fund Shareholders (as of June 30): 15
– Total Value of Hedge Funds’ Holdings (as of June 30): $153.77 Million
Trina Solar Limited (ADR) (NYSE:TSL) received more attention from the hedge funds followed by Insider Monkey during the second quarter, as the number of funds invested in the company rose to 15 from 12 quarter-over-quarter. Nevertheless, the overall value of those funds’ equity investments in Trina Solar fell by nearly 23% quarter-on-quarter to $153.77 million, mainly reflecting a 22% drop in the value of Trina Solar’s American Depositary Shares suffered during the June quarter. The China-based large-scale integrated solar power products manufacturer and solar system developer has seen its market capitalization decline by 4% since the start of the year. In early August, Trina Solar Limited, China’s largest solar panel manufacturer, announced an agreement to be acquired by its founding Chairman and a consortium of investors in a $1.1 billion all-cash transaction. The move to go private is expected to be completed in the first quarter of 2017. Kerr Neilson’s Platinum Asset Management reported ownership of 5.84 million ADSs of Trina Solar Limited (ADR) (NYSE:TSL) through the latest round of 13Fs.