Top 5 green energy stocks to watch in March: NEE to TSLA

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Top 5 green energy stocks to watch in March: NEE to TSLA

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 Top 5 green energy stocks to watch in March: NEE to TSLA
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Highlights

  • NextEra Energy’s (NYSE: NEE) dividend yield is 2%, and its annualized dividend is US$1.70.
  • Tesla (NASDAQ: TSLA) delivered 936,222 units globally in 2021; its P/E ratio is 165.28.
  • Clearway Energy’s (NYSE: CWEN) P/E ratio is 113.02, and the dividend yield is 4.13%.

As the Russia-Ukraine war enters its fifth day, the global energy market faces unprecedented pricing and supply-chain disruption. A significant portion of Europe’s energy needs is met by Russia, one of the world’s largest oil suppliers. Although the energy is hoping for a speedy resolution to the conflict, there is no sign yet of letting up. 

Meanwhile, the US and Europe have announced several sanctions against Russia. But it has only aggravated the industry concerns, with oil prices reaching close to the US$100 mark. The rising oil prices could affect the downstream industries and slow down economic growth.

Although the possible disruption in the industry could be severe in the short term, the renewable or the green energy sector will likely see an increased growth momentum. Analysts believe the climate concerns and the favorable government policies would give an extra push.

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In August 2021, the House passed a US$1.2 trillion infrastructure bill, which included funding for clean energy projects, seen as a gamechanger for the renewables sector. Here we discuss five green stocks that may gain traction amid soaring energy prices and inflationary pressure.

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NextEra Energy, Inc. (NYSE: NEE)

Market Cap: US$151.45 billion

Closing price on February 25, 2022: US$77.16

NextEra Energy’s regulated utility, Florida Power & Light (FP&L), provides electricity to approximately five million customers in Florida. It also supplies renewable energy to Canada. 

In the fiscal year ended December 31, 2021, its operating revenue was US$17.07 billion.  

Its net income attributable to NextEra Energy on a GAAP basis came in at US$3.573 billion, or US$1.81 per share, an increase by US$654 million, or US$0.33 per share, compared to US$2.919 billion, or US$1.48 per share, in 2020. 

NextEra Energy expects adjusted earnings per share to be between US$2.75 to US$2.85 in 2022, instead of the previously expected range of US$2.55 to US$2.75 per share. 

Its stock traded in the range of US$93.73 to US$68.33 in the last 52 weeks. NEE has a P/E ratio of 42.63 and a dividend yield of 2%. Its annualized dividend is US$1.70.

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(Top Green energy stock to watch in March, amid energy concerns)

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First Solar, Inc. (NASDAQ: FSLR)

Market Cap: US$7.5 billion

Closing price on February 25, 2022: US$70.68

The Arizona-based First Solar designs and manufactures solar photovoltaic panels and systems for utility-scale development projects. It converts sunlight into electricity through thin-film technology. It has plants in the US, Malaysia, and Vietnam and plans to foray into India.

It will declare its fourth-quarter and full-year 2021 results on March 1, 2022.

For the third quarter of 2021, its net sales were US$583.5 million compared to US$927.6 million in 2020. The net income came in at US$45.2 million, or US$0.42 per share diluted, compared to US$155 million or US$1.45 per share diluted in the previous year. 

Its stock traded in the range of US$$123.12 to US$61.24 in the last 52 weeks. First Solar’s P/E ratio is 16.71, and the forward P/E for one year is 16.63.

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Tesla, Inc. (NASDAQ: TSLA)

Market Cap: US$837 billion

Closing price on February 25, 2022: US$809.87

Tesla is a vertically integrated sustainable energy company. The Palo Alto, California-based Tesla sells solar panels and solar roofs for energy generation. It also sells batteries for residential and commercial purposes. Its EV portfolio includes luxury and midsize sedans, crossover SUVs, small SUVs, light trucks, semi-truck, and sports cars.

It delivered 936,222 units globally in 2021.

For full-year 2021, its total revenues were US$53.82 billion, up 71% from the previous year. Its net income attributable to common shareholders was US$5.52 billion, compared to US$0.721 billion in FY 2020. It ended the year with US$17.58 billion in cash and equivalents compared to US$1.81 billion at the end of FY2020.

The TSLA stock moved in the range of US$1,243.49 to US$539.49 in the last 52 weeks. Its P/E ratio is 165.28, and the forward P/E for one year is 106.56.

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Clearway Energy, Inc. (NYSE: CWEN)

Market Cap: US$3.95 billion

Closing price on February 25, 2022: US$32.92 

Clearway Energy Inc is an electric utility company based in Princeton, New Jersey. It owns, operates, and acquires renewable and conventional energy generation and thermal infrastructure assets. Its conventional, renewables and thermal divisions control the portfolio of natural gas, oil, solar, and wind-fueled power-producing facilities. 

In fiscal 2021, it generated revenue of US$1.29 billion compared to US$1.2 billion in the previous year. The net income attributable to Clearway Energy more than doubled to US$51 million or US$0.44 per share diluted in fiscal 2021 versus US$25 million or US$0.22 per share diluted in the fiscal year ended December 31, 2020. 

Its stock price moved in the range of US$39.75 to US$24.93 in the last 52 weeks. CWEN’s P/E ratio is 113.02, the forward P/E for one year is 34.29, and the dividend yield is 4.13%.

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(Top Green energy stock to watch in March, amid energy concerns)

Source: Pixabay

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Renewable Energy Group, Inc. (NASDAQ: REGI)

Market Cap: US$3.04 billion

Closing price on February 25, 2022: US$43.81

The Iowa-based Renewable Energy Group produces biofuels for the oil and gas industry. It converts oil, grease, and natural fats into biofuels and renewable chemicals. 

For the September quarter of 2021, it reported revenue of US$1 billion, compared to US$0.572 billion in the same quarter in the prior year.  

The net income almost doubled to US$42.13 million, or US$0.83 per share diluted, compared to US$22.2 million, or US$0.51 per share diluted in the September quarter of 2020.

On February 28, 2022, it announced a definitive agreement with Chevron, allowing the latter to purchase all the REGI outstanding shares for US$61.50 per share in cash.  

REGI’s board has approved the deal, but it has come under the lens of law firm Wohl & Fruchter LLP, which is investigating the agreement.

Its stock price moved in the range of US$92.30 to US$32.54 in the last 52 weeks. REGI has a P/E ratio of 15.39, and the forward P/E for one year is 10.43.

Bottomline 

With the global shift to renewables to fight climate change, green energy stocks will be in focus in the coming years. The current high oil prices will further accelerate the change. However, investors should carefully evaluate the companies before investing in the stock market.

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