Solar stocks, for the most part, ended 2021 on a low note. Many investors have decided to take money off the table following the big gains in the names of alternative energy. For example, the The Dow Jones US Renewable Energy Equipment Total Stock Market index fell 24.0% in 2021.
Yet despite the volatility of solar stock prices, adoption of this alternative energy source is growing in popularity. According to a report According to the Solar Energy Industries Association (SEIA), solar installations in the third quarter jumped 33% year-over-year (YOY), the best Q3 on record. Currently, “one in 600 US homeowners now install solar panels quarterly.”
Nonetheless, the outlook for 2022 has been lowered due to supply chain constraints as well as global price increases. In addition, the US solar sector has recently come under pressure. First the US Department of Commerce refused to investigate allegations of unfair Chinese dumping.
in additionA US judge overseeing trade matters on Tuesday overturned a decision by then-President Donald Trump to allow the reimposition of tariffs on certain imported solar panels. The decision… is a defeat for some domestic manufacturers.
Finally, Wall Street is debating whether President Joe Biden Rebuild better plan can still be revived. InvestorPlace.com readers may recall that Senator Joe Manchin refuse to support the social spending plan. The bill includes $ 300 billion in tax incentives related to clean energy and could allow solar installations to grow by 31% until 2026.
Whatever the short-term challenges, renewable energy stocks should appeal to readers who want to invest for the bright days ahead. With this information, here are three solar actions that could gain ground in 2022:
- First solar (NASDAQ:FSLR)
- Sunnova Energy International (NYSE:NOVA)
- SunPower (NASDAQ:SPWR)
Solar stocks: first solar (FSLR)
52 week range: $ 67.71 – $ 123.13
First Solar supplies photovoltaic (PV) panels and modules and is particularly well known for its thin film technology. The Arizona-based company has production lines in Ohio, India, Vietnam, and Malaysia. Wall Street is interested in expanding manufacturing, especially in India.
First solar report Q3 results beginning of November. Revenue of $ 584 million implied a 37% year-over-year decline. Net income was $ 45 million, or 42 cents per diluted share, compared to $ 155 million, or $ 1.45 per diluted share in the prior year quarter. Cash and cash equivalents ended the quarter at $ 1.9 billion. Free cash flow was $ 140.7 million, up $ 39.1 million from the same period last year.
“On the business side, we had a good quarter, bringing our year-to-date bookings record to 10.5 GWdc,” CEO Mark Widmar said of the results.
The management recently signed multi-year contracts with Pb light source and the energy giant PA (NYSE:PA) for its thin-film photovoltaic solar modules. In addition, the United States’ International Development Finance Corporation (DFC) has approved a $ 500 million loan for the next generation panel manufacturing plant in India.
FSLR stock is currently trading at around $ 84, far from its multi-year high of $ 123.12 reached on November 1. Over the past year, the stock has fallen by about 12%. Still, the 12-month median price forecast for First Solar is $ 115.
The shares are trading at around 22.92 times trailing sales. Long-term investors who can tolerate some volatility might consider investing around $ 85.
Sunnowill Energy International (NOVA)
52 week range: $ 22.07 to $ 55.55
Based in Houston, Texas, Sunnova is a US residential solar and energy storage service provider. At the end of November, the management announced a partnership with Charging point (NYSE:CHPT), which provides charging equipment for electric vehicles (EVs). When a customer makes a purchase, they have a facility for recharging electric vehicles and solar energy.
Management issued 3rd quarter indicators end of October. Revenue increased 37.3% year-on-year to $ 68.9 billion. The net loss of $ 25.9 million translated into a loss of 25 cents per diluted share. In the prior year quarter, net loss and loss per share were $ 73.3 million and 73 cents, respectively. The company ended the quarter with $ 951 million in cash and cash on hand.
Following the announcement, CEO William J. Berger said, “Our vision is to be a wireless electricity provider and our goal is to electrify our customers’ homes so they have the freedom to live. their life without interruption.
Looking ahead, management gave its outlook for 2022, which included customer additions of 83,000 to 87,000 and revenues of $ 134 to 154 million.
Sunnova stock hit an all-time high about a year ago on January 7, 2021. It is currently around $ 23.91, down more than 44% year-to-date (YTD). The price-to-sell (P / S) ratio stands at 13.63x, and the 12-month median price forecast for NOVA shares is $ 56.
Analysts agree steady growth in solar power is almost unstoppable, especially given President Joe Biden’s move 2030 carbon-free power goal. Interested investors might consider keeping NOVA stocks on their radar to buy the dips.
Solar stocks: SunPower (SPWR)
52 week range: $ 18.55 to $ 57.52
SunPower, based in California, provides fully integrated solar power, storage and home power solutions in North America. Despite supply chain disruptions and headwinds of competition in the industry, management is taking steps towards solid growth. For example, the recent acquisition of Blue Raven Solar, enabled the company to expand in the North West and Central Atlantic regions.
In addition, with the launch of SunPower Financial, the group now offers various financial products to make the installation of residential solar installations easier and potentially more affordable. SunPower T3 financial results published in early November showed strong growth in residential demand with record lead generation.
Revenue improved by 17.8% year-on-year to reach $ 323.6 million. Non-GAAP net income was $ 9.8 million, or 6 cents per diluted share. A year ago, the non-GAAP net loss was $ 6.5 million and a loss of 4 cents per diluted share. The company ended the quarter with cash of $ 268.6 million, down $ 56.1 million year-over-year.
On metrics, CEO Peter Faricy said, “Now is the time for homeowners to embrace solar power and storage, with flexible financing options and clean energy favorable incentives currently being considered by Congress that make it easier for consumers to fight against the growing impact of climate change. “
But the California Public Utilities Commission recently slashed incentives offered granted for the excess power of the solar panels on the roof in the network. If accepted, these changes could spell headwinds for the company.
SPWR stock is currently hovering around $ 20, around 64% below its late January 2021 highs and down 18.6% in the past 52 weeks. The shares are trading at 13.07 times trailing sales. The 12-month median price forecast for SunPower is $ 27. Interested investors might consider buying around these levels.
ohAt the date of publication, Tezcan Gecgil had (directly or indirectly) no position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to the publication guidelines of InvestorPlace.com.
Tezcan Gecgil, Ph.D., has worked in investment management for over two decades in the US and UK. In addition to having completed graduate studies in the field, she has also passed all three levels of the Chartered Market Technician (CMT) exam. His passion is for options trading based on the technical analysis of fundamentally sound companies. She especially enjoys setting up weekly covered calls to generate income.