Solar Stocks Alert: Why Are RUN, ENPH, SEDG and TAN Stocks Hotting Up Today?


Solar stocks shine today as a number of big players in the electric space post strong gains today. SunRun (NASDAQ:CLASSES), Phase (NASDAQ:ENPH), SolarEdge (NASDAQ:SEDG) and Invesco (NYSE:TANNING) are all in the green today as markets rebound from last week’s slump.

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What’s happening in the solar world today?

Well, it looks like solar and wind stocks are benefiting from rising oil and gas prices. Indeed, Russia’s invasion of Ukraine has put inflationary pressure on energy prices at all levels. With Russia being one of the world’s largest producers of natural gas, the nation’s recent invasion of Ukraine and subsequent sanctions have had a dramatic impact on fuel prices. European natural gas rose 60%, with Brent crude oil hitting over $100 a barrel for the first time since 2015.

Faced with rapidly rising prices for oil, natural gas and even electricity, many suspect that solar power will make a comeback. As such, today’s jump in solar stocks is hardly a surprise. RUN, ENPH and TAN are each up over 6% ahead of afternoon trade. It comes as the big gainer SEDG is trending up 11%.

What else do you need to know about the resurgence of solar today?

Solar stocks see a perfect storm behind today’s boom

In an email to BarronsAmeet Thakkar, analyst at BMO Capital Markets commented on the current state of the energy market:

“Given the geopolitical events unfolding today that have driven energy commodity prices up significantly (oil, natural gas, electricity) as well as increased investor belief that energy prices could remain high, it has renewed interest in clean energy stocks like Sunrun.The potential for solar to be more price competitive with utility electricity tariffs is reinforced in a climate of high energy commodity prices.

This comes on top of interest rates, which present another bullish force for solar. Many suspect that the Russian-Ukrainian conflict will eventually reduce the strength of future interest rate hikes. Solar stocks typically benefit from lower interest rates as many companies take out debt to finance growth investments.

Indeed, the Federal Reserve has been hinting at an interest rate hike for months now. In general, investors increasingly suspect that they will be larger and more frequent than originally expected. However, many suspect that due to Russia’s invasion, the Fed will raise rates fewer times and with less magnitude.

All of this combined paints a pretty picture for solar stocks lately. It remains to be seen whether the industry will see sustained gains further into the week.

As of the date of publication, Shrey Dua does not hold (either directly or indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to publishing guidelines.


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