The 3 Most Undervalued Renewable Energy Stocks to Buy Now: August 2023

Stocks to buy

As time goes on, scientists continue to look for the most efficient ways to generate energy without the need to harm our ecosystem. The work they are doing is incredible and they are leveraging impressive technology. Here are three undervalued renewable energy stocks to take a look at and consider having in your portfolio.

NextEra (NEE)

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NextEra Energy (NYSE:NEE) has set its sights on harnessing the power of renewable sources such as the sun and wind, instead of relying on fossil fuels that wreak havoc on the environment. They have an unwavering commitment to a greener future as they focus on generating electricity without causing damage to our fragile ecosystems.

The financial picture is also impressive. In the second quarter of 2023, they earned a staggering $2.795 billion in profits, a monumental leap from the $1.38 billion they earned in the same period last year. This remarkable growth trajectory underscores its strong position in the industry.

However, its significance does not end with monetary gains. NextEra Energy has embarked on an innovative venture with CF Industries Holdings (NYSE:CF), focusing on developing environmentally friendly hydrogen production. Hydrogen has immense potential as a future clean energy source, and this collaboration could pave the way for a new era of sustainable energy.

As if that weren’t enough, the global business landscape has taken note of their efforts. Fortune has recognized NextEra Energy as one of the most admired companies globally. Being a leader across all sectors, not only in energy, speaks to NextEra’s presence among top renewable energy stocks.

First Solar (FSLR)

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First Solar (NASDAQ:FSLR) envisions a world where solar panels are as common as leaves on a tree and function the same. The goal is universal solar panels usage, creating a form of energy we can use over fossil fuels. First Solar’s state of the art panels prove that technology can emulate the efficiency and elegance of natural systems.

Investing in First Solar is an investment in a greener future. As the value of its solar panels appreciates with growing solar energy demand, investors can benefit both financially and environmentally.

The figures confirm the influence of solar panels. First Solar has $811 million in sales, $1.59 in net income per share and a net cash balance of $1.5 billion. The company’s financial stability is undeniable.

Operating metrics shed light on its commitment to growth. Contracts generating 21.1 gigawatts of solar power this year, plus anticipated sales of 77.8 gigawatts in the future, cement its dedication to advancing clean energy solutions.

Expansion plans are also underway, with a new manufacturing plant in Louisiana. This $1.1 billion project contributes to renewable energy, as well as local economies by generating more than 700 jobs.

Collaboration is the cornerstone of progress, and First Solar exemplifies this through its partnership with nanotechnology pioneer UbiQD, Inc. Together they are striving to improve their products by incorporating fluorescent quantum dot technology into advanced solar modules. The preliminary results of this collaboration are promising and point to a future marked by even more advanced and efficient solar solutions.

SolarEdge (SEDG)

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SolarEdge Technologies (NASDAQ:SEDG) are the architects of smart solar solutions by utilizing sunlight to power homes and businesses. They have taken the complexity out of solar energy, making it accessible and impactful.

The numbers speak volumes about their influence. In the most recent quarter, their profits exceeded $991 million, of which nearly $950 million came from solar alone. Its deft cost management has paved the way for a solid profit margin of about 32%.

But the company is not content with just the numbers, it is are pioneering innovation. SolarEdge has ingeniously developed a “brain” for electric vehicle chargers, seamlessly integrating them with solar power. This innovation optimizes the charging process, which is a boon for places with a high prevalence of electric vehicles, such as densely populated residential areas.

SolarEdge’s collaboration with tech giant Samsung adds another layer of excitement. Together, the companies are shaping the Net Zero Home initiative, a concept that involves homes efficiently generating, storing and using their own energy. Although exact details have yet to be finalized, this collaboration promises a future characterized by sustainable, energy-efficient living spaces.

As of this writing, Gabriel Osorio-Mazzilli did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Gabriel Osorio is a former Goldman Sachs and Citigroup employee. He possesses discipline in bottom-up value investing and volatility-based long/short equities trading.

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