In this article, we will discuss the 10 alternative energy stocks to buy amid the energy crisis in Europe.
As concerns around climate change heat up, generating electricity from renewable and eco-friendly sources is becoming a top priority of nations across the globe. The Biden administration has introduced policies that will help the U.S. achieve carbon neutrality by 2050. The U.S. plans on generating 100% of its electricity from carbon-free sources by 2035. Currently, the U.S. generates over half of its clean energy from nuclear power facilities. On April 19, the U.S. government announced $6 billion in funding to keep the nation’s nuclear plants operational that were otherwise expected to shut down.
The Energy Crisis in Europe and REPowerEU
The war in Ukraine has wreaked havoc in Europe, sparking fears of the nation going through an alarmingly cold winter. Germany, Europe’s largest economy, is heavily dependent on Russian oil and gas, fossil fuels, and liquified natural gas. With Putin ordering a complete cut-off of gas supplies to Europe via Nord Stream 1 on August 31, European policymakers are working on keeping the region lit and heated, especially for the winter.
On May 18, the European Union announced the REPowerEU plan to phase out dependence on Russian fossil fuels. One of the major pillars of the REPowerEU plan is significant upgrades to Europe’s green energy goals for 2030. The European Commission has raised its 2030 target range for generating electricity from renewables by between 40% and 45%. The EU plans to invest EUR 210 billion to in the REPowerEU initiative, which aims to ensure Europe’s energy security and accelerate its green transition.
Alternative Energy Industry: Market Size and Forecast
With the U.S. and EU leading the world’s green energy transition, the alternative energy industry is on the path to experiencing unprecedented growth. According to an analysis report by Allied Market Research, the global renewable energy market was worth roughly $882 billion in 2020 and is expected to hit a valuation of $1.97 trillion by 2030, growing at a compound annual growth rate of 8.4% over the forecasted period. Precedence Research expects the global renewable energy industry to garner a value of roughly $2 trillion by 2030, growing from $952 billion in 2021 at a CAGR of 8.6% over the forecasted period. North America is expected to be the fastest-growing region over the years to come and so far, Asia Pacific has held the most dominant market share in renewable energy consumption.
The key players that are operating in the alternative energy space and can benefit from Europe’s energy crisis as the region looks at alternatives to fossil fuels include SolarEdge Technologies, Inc. (NASDAQ:SEDG), Brookfield Renewable Partners L.P. (NYSE:BEP), and Plug Power, Inc. (NASDAQ:PLUG).
Photo by Nicholas Doherty on Unsplash
Our Methodology
To determine the 10 alternative energy stocks to buy amid the energy crisis in Europe, we reviewed the renewable energy industry. We looked at both international stocks and stocks listed on U.S stock exchanges. To determine which companies can potentially experience strong demand for their products and services as Europe looks for alternatives to fossil fuels, we preferred stocks that have operations in Europe. We have mentioned each company’s business model, the products it offers, and the regions it operates in. We have also included the analyst rating for each of our picks.
10. Siemens Gamesa Renewable Energy SA (OTC:GCTAF)
Siemens Gamesa Renewable Energy SA (OTC:GCTAF) is a leading European clean energy provider. The company operates through two business segments: Wind Turbines and Operations & maintenance. The company provides renewable energy and winder power solutions in Europe, the Middle East, Africa, the Americas, Asia, and Australia.
On July 15, Citi analyst Vivek Midha resumed coverage of Siemens Gamesa Renewable Energy SA (OTC:GCTAF) with a Neutral rating and a price target of EUR 18.05.
On August 2, Siemens Gamesa Renewable Energy SA (OTC:GCTAF) announced earnings for the third quarter of fiscal 2022. The company reported revenue of EUR 2.43 billion, in-line with analyst expectations. The company’s net income for the quarter amounted to EUR 446 million.
9. Ørsted A/S (OTC:DNNGY)
Ørsted A/S (OTC:DNNGY) is a leading Danish renewable energy provider. The company develops and operates offshore and onshore wind farms, solar farms, energy storage facilities, and bioenergy plants. The company’s primary business segments are Offshore, Onshore, and Markets & Bioenergy. Ørsted A/S (OTC:DNNGY) has operations in the United Kingdom, Germany, Denmark, the Netherlands, the United States, Taiwan, Japan, and South Korea. As of September 5, the stock is offering a forward dividend yield 1.89%.
Wall Street is bullish on Ørsted A/S (OTC:DNNGY). On June 30, HSBC analyst Adam Dickens upgraded Ørsted A/S (OTC:DNNGY) to Buy from Hold and raised his price target to DKK 930 from DKK 910. The analyst noted that offshore wind is relatively protected from inflation, regulatory challenges, and project delays. On August 4, Redburn analyst Simon Toyne upgraded Ørsted A/S (OTC:DNNGY) to Neutral from Sell.
On August 11, Ørsted A/S (OTC:DNNGY) announced earnings for the first half of 2022. The company grew its revenue by 84.8% year over year and reported a revenue of DKK 60 billion. The company also reported earnings per share of DKK 13.50.
In addition to Ørsted A/S (OTC:DNNGY), companies that can experience high demand from their European operations due to the ongoing energy crisis include SolarEdge Technologies, Inc. (NASDAQ:SEDG), Brookfield Renewable Partners L.P. (NYSE:BEP), and Plug Power, Inc. (NASDAQ:PLUG).
8. Vestas Wind Systems AS (OTC:VWDRY)
Vestas Wind Systems AS (OTC:VWDRY) is a leading global European developer and provider of wind turbines and is among the largest wind turbine companies in the world. The company operates through two business segments: Power Solutions and Services.
On August 10, Vestas Wind Systems AS (OTC:VWDRY) reported that its revenue for the fiscal second quarter of 2022 amounted to EUR 3.31 billion. For fiscal 2022, the company sees revenue in a range between EUR 14.5 billion and EUR 16 billion. The company expects its service revenue to grow by 10% for fiscal 2022.
Wall Street sees potential in Vestas Wind Systems AS (OTC:VWDRY). On July 29, HSBC analyst Sean McLoughlin upgraded Vestas Wind Systems AS (OTC:VWDRY) to Hold from Reduce and reiterated his price target of DKK 190. On August 11, Deutsche Bank analyst Gael de-Bray raised his price target on Vestas Wind Systems AS (OTC:VWDRY) to DKK 180 from DKK 170 and maintained a Hold rating on the shares.
7. Electricité de France S.A. (OTC:ECIFF)
Electricité de France S.A. (OTC:ECIFF), or more commonly known as the EDF group, is one of the biggest energy companies in France with operations worldwide. The company generates power through a variety of renewable sources such as solar, wind, biomass, and nuclear. Electricité de France S.A. (OTC:ECIFF) has over 50 active nuclear reactors and owns various nuclear projects in Europe and Asia.
On July 28, Electricité de France S.A. (OTC:ECIFF) reported earnings for the first half of 2022. The company generated a revenue of EUR 66 billion, up 67% year over year. that its revenue for the first half of 2022 grew by 67% year over year.
Electricité de France S.A. (OTC:ECIFF) is gaining in the market and also trading at bargain levels. As of September 5, the stock has returned 48% to investors over the past twelve months, is trading at a price-to-earnings ratio of 8.85, and is offering a strong forward dividend yield of 5.22%.
6. Canadian Solar Inc. (NASDAQ:CSIQ)
Number of Hedge Fund Holders: 13
Canadian Solar Inc. (NASDAQ:CSIQ) designs and manufactures solar ingots, wafers, cells, modules, and solar battery storage products among other solutions for the solar industry. The company has operations in Asia, the Americas, Europe, and international markets. Shares of Canadian Solar Inc. (NASDAQ:CSIQ) have surged 41.65% year to date, as of September 2.
On August 18, Canadian Solar Inc. (NASDAQ:CSIQ) announced earnings for the fiscal second quarter of 2022. The company reported earnings per share of $1.07 and outperformed estimates by $0.74. The company’s revenue for the quarter amounted to $2.31 billion, up 61.87% year over year, and outperformed market consensus by $83.39 million.
On August 8, JPMorgan analyst Mark Strouse raised his price target on Canadian Solar Inc. (NASDAQ:CSIQ) to $42 from $38 and reiterated a Neutral rating on the shares.
At the close of Q2 2022, 13 hedge funds were bullish on Canadian Solar Inc. (NASDAQ:CSIQ) and held stakes worth $54.2 million. This is compared to 15 positions in the previous quarter with stakes worth $37.91 million.
As of June 30, D E Shaw owns roughly 0.43 million shares of Canadian Solar Inc. (NASDAQ:CSIQ) and is the largest shareholder in the company. The fund’s stakes are valued at $13.5 million.
In addition to Canadian Solar Inc. (NASDAQ:CSIQ), Wall Street analysts are also bullish on SolarEdge Technologies, Inc. (NASDAQ:SEDG), Brookfield Renewable Partners L.P. (NYSE:BEP), and Plug Power, Inc. (NASDAQ:PLUG) as they see these companies gaining more market share in Europe as it seeks alternatives to fossil fuels.
5. Brookfield Renewable Partners L.P. (NYSE:BEP)
Number of Hedge Fund Holders: 19
Brookfield Renewable Partners L.P. (NYSE:BEP) generates and supplies renewable energy hydroelectric, wind, solar, distributed generation, pumped storage, cogeneration, and biomass sources. The company has operations in North America, Colombia, Brazil, Europe, India, and China. The company’s portfolio consists of over 20,000 megawatts of installed capacity.
On August 5, Brookfield Renewable Partners, L.P. (NYSE:BEP) announced earnings for the second quarter of fiscal 2022. The company reported funds from operations of $0.46 and generated a revenue of $1.27 billion, up 25% year over year, and outperformed Wall Street expectations by $129.3 million. As of September 5, the stock has gained 3.38% year to date.
Wall Street analysts see upside to Brookfield Renewable Partners, L.P. (NYSE:BEP). This August, JPMorgan analyst Mark Strouse raised his price target on Brookfield Renewable Partners L.P. (NYSE:BEP) to $43 from $41 and reiterated a buy-side Overweight rating on the shares. Moreover, on August 8, Desjardins analyst Brent Stadler raised his price target on Brookfield Renewable Partners L.P. (NYSE:BEP) to C$50 from C$49 and maintained a Hold rating on the shares.
At the end of the second quarter of 2022, 19 hedge funds were long Brookfield Renewable Partners L.P. (NYSE:BEP) and held stakes worth $236.31 million in the company. This is compared to 18 positions in the preceding quarter with stakes worth $261.96 million.
As of June 30, Select Equity Group owns 2.58 million shares of Brookfield Renewable Partners L.P. (NYSE:BEP) and is the largest shareholder in the company. The investment covers 0.28% of the fund’s 13F portfolio.
Here is what ClearBridge Investments had to say about Brookfield Renewable Partners L.P. (NYSE:BEP) in its first-quarter 2022 investor letter:
“Brookfield Renewable is a pure-play renewables operator and developer headquartered in Canada, focused on international hydro, solar, wind and storage technology. As more private and public institutions announce ambitious carbon reduction initiatives, Brookfield Renewable’s globally diversified, multi- technology renewables business makes it an attractive partner. Brookfield’s development pipeline stands at 18,000 MWs, providing confidence the company can meet its targeted double- digit cash flow growth through to 2025. The market narrative around the energy transition and energy security, along with increasing fossil fuels prices which have driven greater focus on switching to renewables, helped Brookfield shares in the quarter.”
4. Bloom Energy Corporation (NYSE:BE)
Number of Hedge Fund Holders: 24
Bloom Energy Corporation (NYSE:BE) designs and manufactures green solid-oxide fuel cell systems for on-site power generation in the United States and European markets. The company provides combustion-free energy solutions. As of September 5, Bloom Energy Corporation (NYSE:BE) has gained 11.02% over the past six months.
Wall Street analysts see upside to Bloom Energy Corporation (NYSE:BE) and see the stock capturing more market share in Europe. On August 19, Susquehanna analyst Biju Perincheril raised his price target on Bloom Energy Corporation (NYSE:BE) to $35 from $30 and maintained a Positive rating on the shares. On August 25, BofA analyst Julien Dumoulin-Smith resumed coverage of Bloom Energy Corporation (NYSE:BE) with a Buy rating and reiterated his price target of $34 on the shares.
At the end of Q2 2022, 24 hedge funds disclosed ownership of stakes in Bloom Energy Corporation (NYSE:BE). The total value of these stakes amounted to $73.4 million.
As of June 30, Marshall Wace LLP owns roughly 1 million shares of Bloom Energy Corporation (NYSE:BE) and is the largest shareholder in the company. The fund’s stakes are valued at $17 million.
3. Plug Power, Inc. (NASDAQ:PLUG)
Number of Hedge Fund Holders: 26
Plug Power Inc. (NASDAQ:PLUG) is a pioneer of hydrogen and zero-emissions fuel cell solutions. The company’s energy solutions apply to various applications including supply chain, logistics, electric vehicles, and the power market among others. Plug Power, Inc. (NASDAQ:PLUG) operates in North American and European markets. As Europe strives to enhance its energy security and abandon fossil fuels, green hydrogen solutions that are offered by Plug Power, Inc. (NASDAQ:PLUG) are expected to experience strong demand.
Wall Street is bullish on green hydrogen and Plug Power, Inc.’s (NASDAQ:PLUG) position in the market. This August, Craig-Hallum analyst Eric Stine raised his price target on Plug Power, Inc. (NASDAQ:PLUG) to $38 from $31 and reiterated a Buy rating on the shares. On August 18, Morgan Stanley analyst Stephen Byrd raised his price target on Plug Power, Inc. (NASDAQ:PLUG) to $53 from $42 and maintained an Overweight rating on the shares.
At the end of Q2 2022, 26 hedge funds held stakes in Plug Power, Inc. (NASDAQ:PLUG) worth $258.88 million. Of those, D E Shaw was the top shareholder with stakes worth $60.4 million.
2. First Solar, Inc. (NASDAQ:FSLR)
Number of Hedge Fund Holders: 26
First Solar, Inc. (NASDAQ:FSLR) is a leading developer and supplier of solar photovoltaic (PV) energy solutions. The company operates in the United States, Japan, France, Canada, India, Australia, and other international markets. As of June 30, D E Shaw owns roughly 1 million shares of First Solar, Inc. (NASDAQ:FSLR) and is the most prominent shareholder in the company.
On July 28, First Solar, Inc. (NASDAQ:FSLR) announced earnings for the second quarter of fiscal 2022. The company generated a revenue of $621 million and outperformed Wall Street expectations by $14.5 million. First Solar, Inc. (NASDAQ:FSLR) is on the rise. As of September 5, the stock has returned 42.71% to investors year to date.
Wall Street is bullish on First Solar, Inc. (NASDAQ:FSLR). On August 31, Baird analyst Ben Kallo raised his price target on First Solar, Inc. (NASDAQ:FSLR) to $164 from $119 and reiterated a buy-side Outperform rating on the shares. This August, BofA analyst Julien Dumoulin-Smith raised his price target on First Solar, Inc. (NASDAQ:FSLR) to $152 from $141 and maintained a Buy rating on the shares.
At the close of the second quarter of 2022, 26 hedge funds held stakes in First Solar, Inc. (NASDAQ:FSLR). The total value of these stakes amounted to $189.14 million.
1. SolarEdge Technologies, Inc. (NASDAQ:SEDG)
Number of Hedge Fund Holders: 40
SolarEdge Technologies, Inc. (NASDAQ:SEDG) develops, designs, and manufactures DC-optimized inverter systems for solar photovoltaic installations all across the world. The company through five business segments: Solar, Energy Storage, e-Mobility, Critical Power, and Automation Machines. At the end of Q2 2022, 40 hedge funds were long SolarEdge Technologies, Inc. (NASDAQ:SEDG) with stakes worth $749.36 million.
On August 2, SolarEdge Technologies, Inc. (NASDAQ:SEDG) reported earnings for the second quarter of fiscal 2022. The company generated a revenue of $727.7 million, up 51.6% year over year. The company reported earnings per share of $o.95.
Wall Street analysts see SolarEdge Technologies, Inc. (NASDAQ:SEDG) benefiting from the current energy situation and are bullish on the stock. On August 8, JPMorgan analyst Mark Strouse raised his price target on SolarEdge Technologies, Inc. (NASDAQ:SEDG) to $419 from $373 and reiterated a buy-side Overweight rating on the shares. On August 18, Morgan Stanley analyst Stephen Byrd raised his price target on SolarEdge Technologies, Inc. (NASDAQ:SEDG) to $352 from $316 and maintained an Equal Weight rating on the shares.
As of June 30, Impax Asset Management owns roughly 0.58 million shares of SolarEdge Technologies, Inc. (NASDAQ:SEDG) and is the largest shareholder in the company. The investment covers 0.77% of Ian Simm’s 13F portfolio.
Here is what ClearBridge Investments had to say about SolarEdge Technologies, Inc. (NASDAQ:SEDG) in its second-quarter 2022 investor letter:
“We are well-positioned to participate in the accelerating energy transition. High and rising utility costs combined with policy support are driving increased penetration of home solar plus storage systems in Europe. Israel-based SolarEdge Technologies (NASDAQ:SEDG) expects to see significant growth in solar installations in this market led by Germany and Italy, among others, where consumers are not only demanding solar on the roof but a complete system solution including batteries. This phenomenon is accelerating revenue growth for these companies.”
You can also take a look at 10 Best Alternative Energy Stocks to Buy Now and Analysts Are Recommending These 10 Green Energy Stocks for the Future.
Follow Insider Monkey on Twitter
Suggested Articles:
- 11 Best Alternative Energy Stocks to Buy Right Now
- 11 Best Clean Energy Stocks To Buy
- 10 Best Alternative Fuel Stocks to Buy Now
Disclosure. None. 10 Alternative Energy Stocks to Buy Amid Energy Crisis in Europe is originally published on Insider Monkey.
