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Now could be the time to invest in green energy stocks

Now could be the time to invest in green energy stocks

Financial analysts predict that renewable energy companies are poised for major growth and now is a good time to make an investment in green energy stocks. Many renewable energy companies currently sit at 20 percent below their peak profit, so it is possible to buy in while the cost is low.

According to a CNBC article, Goldman Sachs analysts say, “Government funding, regulatory support and cash flowing into so-called ESG funds — those that take environmental, social and governance factors into account — are now set to boost the performance of renewable energy stocks.“ They added that “…companies exposed to the energy transition are likely to deliver unprecedented growth over the coming decades.”

There is a growing demand for renewable energy in the U.S., so it’s no surprise that financial investors are starting to jump on the clean energy bandwagon. It also doesn’t hurt that the Biden Administration has made a clear commitment to lowering carbon emissions across the country.

So, what does this mean for the average American?

It couldn’t hurt to add a renewable energy stock or two to your financial portfolio. If you’re going to invest, do your research and avoid emptying your entire savings account into one energy stock. Here are few tips when renewable energy stock shopping:

Do your research

Choose a few industry leaders and up-and-coming solar and wind companies to add them to your watchlist. Don’t buy right away. Instead, observe their fluctuations over time and look for patterns before choosing where to invest.

Look for the hidden gems

There are many hidden gems that could wind up being moneymakers as well as larger dividend renewable stocks that could become profitable cash cows.

According to The Motley Fool, First Solar (NASDAQ:FSLR), Proterra  (NASDAQ:PTRA), and Vestas Wind Systems (OTC:VWDRY) are three good “bargain” opportunities right now.

Consider the veteran green energy companies

If you want to play it safe and invest in a been-around-the-block stock, Nasdaq says GE and Siemens Energy could be two good options. Both are leaders in gas turbines and combined cycle plants, and GE plans to grow its offshore wind business to $3 billion in the next three years.

Research specific renewable energy industries when shopping

Consider renewable energy subcategories such as battery storage or electric vehicles.

For example, battery storage is a large component of solar energy and the market is growing with options. Two examples of battery storage companies that are rapidly growing are SunRun (NASDAQ:RUN) and SunPower (NASDAQ:SPWR). Both companies offer backup power which can help lower energy bills.

Hydrogen fuel cells would be another subcategory worth looking into. Hydrogen fuel cells turn hydrogen into electricity and there are several leads in this category that could wind up being a worthwhile investment.

Finally, don’t forget about electric vehicle companies. There are many Tesla-like companies in the waiting that could blow up in no time. And as several states have announced incentives for owning an electric vehicle, EV companies could continue to see success.

Be a smart shopper

Regardless of what stock you decide to take a chance on, don’t invest anything you can’t afford to lose, invest small, and consider meeting with a financial planner to discuss the best options to suit your own personal budget.

 

Jackie Whetzel is a freelance writer who has been featured in newspapers and publications across the country. She has written on the topics of energy, education, government, and business. You can find her on  LinkedIn or Instagram.

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