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- Energy production from solar power is far more cost-efficient and has virtually zero impact on the environment.
- ORG, MYC and NEW are some of the ASX stocks in the solar energy space that are on investors’ radar.
- The solar energy sector is still in the growing phase and investing in this sector would require proper due diligence and risk-taking capacity.
The green energy is clearly the future of world. As many countries across the globe are committed to cutting down their carbon emissions, green energy or renewable sources of energy have been gaining significant importance. One of these renewable sources is solar energy, which is one of the cleanest sources with many benefits.
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Energy production from solar power is far more cost-efficient and has virtually zero impact on the environment. It is also one of the most versatile sources as the solar panels used to generate energy can be designed in any shapes and sizes to adjust to any space. Hence, these can also be used for individual houses and not just for large-scale commercial purposes. On that note, let us have a look at three ASX-listed solar stocks that are on the radar of investors.
Origin Energy is mostly recognised as an oil and exploration company. However, the company has also started to expand its footprint in the renewable sources of energy, as a result of which, it has installed 74 megawatts of solar panels for local homes and businesses.
Also, the company holds a ~20% stake in Octopus Energy, which is a UK-based renewable energy provider. ORG shares last closed at AU$5.78 on 19 January 2022, delivering a decent YTD return of 7.84%. Much of the gains were led by a continuous rally in crude oil, which is now trading above US$88 per barrel, the highest level since November 2014.
Tilt Renewables (which has now been acquired by Mercury NZ and PowAR) has a vast portfolio of renewable energy generation assets as it aims towards a low carbon future. Mercury NZ is an electricity generating and distribution company and now with the assets of Tilt renewables, it has moved one step closer to fulfilling its aim to take New Zealand towards a low-emission future.
MCY shares are mildly down by 1.9% for this year to the last closing price of AU$5.67. The company has a market capitalisation of AU$7.81 billion. It posted a net profit of AU$141 million in FY21 on the revenue of AU$2,05 billion.
The last stock on our list, New Energy Solar owns and operates solar generation facilities at a large scale. It has large portfolios of solar plants and a healthy pipeline of opportunities in Australia and the US. The management is also open to investing in other renewable sectors such as hydro-electricity, wind, geothermal energy, etc.
As of 19 January 2022, the NEW share price closed at AU$0.81, delivering a year-to-date return of a negative 1.22%. It is also a regular dividend paying company and is currently trading at a healthy dividend yield of 9.63%.
The renewable energy space has seen a massive interest in the last couple of years, and with the global environmental concerns non the rise, investing in the right companies could lead to good returns in the future. However, the entire space is not a matured industry yet and is in its growing phase. Hence, investing in this domain requires proper analysis and risk-taking capacity.
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