Two strong solar stocks to watch in May 2022

0

The move from growth stocks, which were hit hard in 2022, could benefit solar stocks as money is likely to flow into the sector.

The maturation seen in the solar industry has made it a focal point for tackling climate change, while this transition has been followed by various government subsidies and stimulus packages.

On the other hand, the war in Ukraine has prompted Europe to scramble to replace Russian gas, which, in turn, has raised energy prices globally. With such a backdrop, a good setup has been created to invest in solar power as the world slowly moves away from fossil fuels.

The two stocks listed below represent solid solar companies that investors should have on their watchlists.

Enphase (NASDAQ: ENPH)

Although the company was apparently close to bankruptcy a few years ago, major changes in management have made the company a survivor. According to their latest revenue report the focus will be on sales in Europe, where 40% of all sales are expected to be made. This is in line with recent developments regarding solar stocks in the United States

Along with the shift in sales, the company posted a record first quarter, with gross margin up 40.1% and operating profit up 86%. Stocks started the year abysmal, continuing the December 2021 slide all the way through February.

Since then, stocks have rallied slightly but are still below all daily simple moving averages (SMAs), volume increases reminiscent of the January selloff; however, stocks appear to be holding with a possible resistance point around $150.

Table of ENPH 20-50-200 SMA lines. Source. Finviz.com data. See more shares here.

On Wall Street, analysts give the stock a strong buy rating with an average price for the next 12 months of $225.08. This forecast is 49.54% higher than the current stock price of $150.51.

Source: TipRanks

Brookfield Renewable Partners (NYSE:BEP)

BEP has made a major bet on the decarbonization of the planet by invest in carbon capture technologies. In addition to new investments, the company has delivered a strong first quarter of 2022 net of $292 million, increasing EPS by 18% to $0.45 per share.

Currently, stocks are yielding 3.76%; however, there is a history of the company increasing its dividends after positive quarters. On May 9, the company shares have been updated by TD stocks from a hold to a buy, indicating that analysts see more value in the company.

Stocks have started 2022 quite well, performing solidly through April, falling recently with an increase in volume. It looks like stocks are gearing up for a double top at around $41, but at the moment stocks are below all SMAs and there is still a long way to go for this setup to materialize.

Table of lines BEP 20-50-200 SMA. Source. Finviz.com data. See more shares here.

Elsewhere, analysts are viewing the stock as a moderate buy, predicting that over the next 12 months the average share price will be $39.34. This is 15.47% above the current trading price of $34.07, with the most bullish analysts seeing the price reaching $46.

Source: TipRanks

With the huge shift away from fossil fuels, investors in solar stocks can rejoice, especially with growing awareness of the threat carbon emissions pose to the planet and a downward trend in prices for solar equipment. .

Although rising inflation has made solar equipment more expensive in 2022 compared to the previous year, this trend will most likely be short-lived. These two companies have a bright future despite short-term market fluctuations.

Warning: The content of this site should not be considered investment advice. The investment is speculative. When you invest, your capital is at risk.

Share.

Comments are closed.