Doing good and profiting handsomely don’t have to be mutually exclusive endeavors, which brings us to high-potential renewable energy stocks. Sure, people shouldn’t aspire to philanthropy to enhance their own wealth; that sort of defeats the purpose. Nevertheless, you can kill two birds with one stone (literally, I guess) with renewability-oriented enterprises.
First, let’s get into the facts. According to Precedence Research, the global renewable energy market size reached a valuation of $1.03 trillion in 2022. Further, experts in the field anticipate that the sector will expand at a compound annual growth rate (CAGR) of 8.6% from 2022 to 2030. At the culmination of the forecast period, the industry will hit just under $2 trillion. That’s a great reason to consider top renewable energy stocks to buy.
Another factor to keep in mind is the political pivot. While hydrocarbons will likely remain relevant for decades to come, policymakers have stressed the importance of addressing climate change. Therefore, renewable energy stocks with upside potential benefit from a burgeoning narrative.
To be sure, no guarantees exist in the market. Nevertheless, if you want to improve your odds of success, buy these renewable energy stocks.
| NEE | NextEra Energy | $74.17 |
| SEDG | SolarEdge | $243.65 |
| PLUG | Plug Power | $9.20 |
NextEra Energy (NEE)
To be fair, NextEra Energy (NYSE:NEE) might not be the most accelerative entity among high-potential renewable energy stocks. As one of the vanguards of the renewable energy space, new market participants will require patience with NEE. Nevertheless, that patience should be rewarded thanks to its massive footprint. Featuring both wind turbines and solar power networks, NEE represents a confidence booster.
However, NextEra also offers room for speculation. Since the beginning of this year, NEE fell more than 10%. In the trailing one-year period, it’s down almost 3%. Over time, the red ink should transition back into the black given the aforementioned industry forecast of the renewable sector. Therefore, it’s a solid pick among top renewable energy stocks to buy.
Financially, NextEra’s main strength lies in its consistent profitability. For example, its trailing-year net margin clocks in at 26.97%, outpacing 91.22% of companies listed in the regulated utilities space.
Finally, analysts peg NEE as a moderate buy. Their average price target comes in at $89.40, implying 19% growth. It’s not the most exciting idea but it belongs on a list of renewable energy stocks with upside potential.
SolarEdge Technologies (SEDG)
Based in Israel, SolarEdge Technologies (NASDAQ:SEDG) develops and sells solar investors for photovoltaic arrays, energy generation monitoring software and battery energy storage products. It also offers related products and services to residential, commercial and industrial customers. SolarEdge features a presence in Germany, Italy, Japan and the U.S.
While an enticing bet among high-potential renewable energy stocks, it’s also incredibly risky. Think of SEDG as an effort to launch a grand slam rather than batting a run or two in with a well-placed hit. Since the beginning of this year, SEDG slipped over 14%. Worryingly, shares have suffered a severe loss of momentum recently. Just in the trailing five sessions, they’re down more than 9%.
At the same time, SEDG could be one of the best stocks in renewable energy sector for speculation. Financially, it features fiscal stability (an Altman Z-Score of 5.88) and a strong revenue growth trend.
Lastly, analysts peg SEDG as a consensus strong buy. Out of 13 analysts, only one failed to issue a buy rating. Overall, the average price target clocks in at $387.23, implying over 58% upside.
Plug Power (PLUG)
Another risky enterprise among high-potential renewable energy stocks, Plug Power (NASDAQ:PLUG) has been fascinating throughout the post-pandemic new normal. At one point, shares on an average weekly basis were flying toward the $70 level. At the moment, they trade hands at less than $10. So, you have a relative discount here, which might entice speculators once again.
Fundamentally, Plug Power intrigues because of its green hydrogen specialty. By green, we’re talking about hydrogen that can be generated by renewable resources like wind and solar energy. If successful, Plug Power may facilitate national energy security while simultaneously addressing climate change. That’s what makes PLUG one of the top renewable energy stocks to buy for gamblers.
Nevertheless, it’s quite the gamble. According to Gurufocus, PLUG suffers from six red flags and no compelling positives to balance out the pessimism. One of the most worrying stats is that the company continues to issue new debt.
At the same time, analysts peg PLUG as a moderate buy. Their average price target stands at $18.42, implying over 90% upside potential.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.