Since hitting all-time highs early this year, many of the market’s largest renewable energy companies have dramatically declined. This is partially due to investors’ overconfidence in trading and partly due to the negative impact of increased interest rates on growth stocks.
Renewable energy is a thriving market with a lot of opportunities for investors, despite the pullback. With the stocks falling over 25 percent from their 52-week highs, three of the renewable energy contributors believe SunPower (NASDAQ: SPWR), TPI Composites (NASDAQ: TPIC), Atlantica Sustainable Infrastructure (NASDAQ: AY), are attractive buys.
Travis Hoium (SunPower), a modest home solar company: SunPower has experienced a lot of changes this year. After quitting the utility-scale solar industry and the solar manufacturing company in recent years, the company has revealed plans to leave the commercial solar market. SunPower also just revealed the acquisition of Blue Raven Solar, a residential solar installer, implying that the firm will now install solar systems itself instead of relying on third-party contractors. However, in the long run, this may be the best option.
SunPower has developed the necessary digital infrastructure and brand recognition to become a leading household solar firm. You can create and price solar installation in only a few minutes on the firm’s website, and the firm has put up the infrastructure to monitor and control solar and power storage installations.
SunPower is strategically well-positioned to compete in the home solar sector, currently ranking second behind Sunrun (NASDAQ: RUN). Furthermore, the stock is now trading at quite a discount to Sunrun. Before the purchase of Blue Raven Solar, SunPower fitted 204 megawatts of residential as well as light commercial solar, and Sunrun built 353 megawatts of solar in the very first half of 2021. However, SunPower’s market cap of about $5.1 billion is much less than half that of Sunrun, which is $10.6 billion, therefore SunPower’s shares appear to be a bargain.
Long-term, home solar will continue to develop in the United States, and SunPower is obviously the market leader. The stock may have fallen from its highs earlier in the year and, but that has generated a discount for long-term investors in the business.
Assets of exceptional quality at a reduced cost
Howard Smith (Atlantica Sustainable Infrastructure): Atlantica Sustainable Infrastructure recorded a 12.9 percent increase in cash available for distribution in the first half of 2021 compared to the same period in 2020. However, this renewable energy asset manager as well as the owner’s stock hasn’t followed suit. In the initial week of January 2021, Atlantica’s stock has dropped over 25%.
With shares earning over 5%, now is an excellent opportunity for investors to purchase an income-generating investment with the potential for capital growth.
The majority of Atlantica’s electricity generation comes from renewable assets, with solar accounting for more than 70% of the total. In addition to electric transmission lines, efficient natural gas, and water capacity, the corporation has other assets. The company’s business model is to expand by acquiring additional assets that generate contracted or regulated revenue, ensuring a consistent stream of income for investors.