Green energy solutions are witnessing rapid growth amid consumer interest and government initiatives. Against this backdrop, strong fundamentals of green energy stocks Canadian Solar (CSIQ), Westlake Chemical Partners (WLKP), and Genie Energy (GNE) should make them sensible portfolio additions. Read on….
Amid growing climate change concerns, several countries have taken steps to transition to a clean energy-driven future. Robust demand and the record-breaking raft of fresh energy incentives within the Inflation Reduction Act (IRA) are anticipated to speed up green energy growth.
Given this backdrop, allow us to explore some green energy stocks, Canadian Solar Inc. (CSIQ), Westlake Chemical Partners LP (WLKP), and Genie Energy Ltd. (GNE), which could save investors’ trading track record, for the explanations mentioned within the article.
The Biden administration plans to eliminate fossil fuels as a type of energy generation in the US by 2035. The White House set a goal of 80% renewable energy generation by 2030 and 100% carbon-free electricity five years later.
Renewables have turn into cost-competitive with major fossil fuels and cost-effective in lots of cases. Furthermore, with hefty incentives and subsidy packages, the federal government is further sweetening the deal by dropping costs. America’s renewable energy was given a green signal with the Inflation Reduction Act that granted $369 billion for green energy.
Post-IRA, projections for solar development are significantly higher. EIA stated in a report, “Across all cases, compared with 2022, solar generating capability grows by about 325% to 1019% by 2050, and wind generating capability grows by about 138% to 235%. We see growth in installed battery capability in all cases to support this growth in renewables.”
The worldwide renewable energy market size is projected to achieve $1.15 trillion by 2027, at a CAGR of 9.1% between 2021 to 2027.
Against this backdrop, fundamentally strong green energy stocks CSIQ, WLKP, and GNE could be solid buys now.
Canadian Solar Inc. (CSIQ)
CSIQ, based in West Guelph, Canada, designs, develops, manufactures, and sells solar ingots, wafers, cells, modules, and other solar energy products. The corporate operates through two segments: Module and System Solutions (MSS); and Energy.
Recently, CSIQ announced CSI Solar Co., Ltd.’s 2024 capability expansion plans. It intends so as to add 30 GW of ingot, 15 GW of wafer, 10 GW of cell, and 25 GW of module capability. As per Dr. Shawn Qu, CSIQ’s Chairman and CEO, the additions can be in the most recent N-type technology, which might enable the corporate to satisfy strong market demand higher and speed up growth.
He added, “By increasing the extent of vertical integration, we proceed to enhance our control over technology, raw material sources and costs. These business plans will help us further strengthen our long-term leadership position not only across our end markets but additionally throughout our supply chain positioning.”
When it comes to the trailing-12-month ROCE, CSIQ’s 12.82 % is 383.7% higher than the two.65% industry average. Likewise, its trailing-12-month ROTA and ROTC of two.66% and 4.75% are 295.5% and 130.5% higher than the industry averages of 0.67% and a pair of.06%, respectively.
For the fiscal fourth quarter that ended December 31, 2022, CSIQ’s net revenues stood at $1.97 billion, representing a rise of 29% year-over-year. Its gross profit increased 15.7% year-over-year to $348.63 million. Also, its income from operations for a similar quarter increased 101.4% from the year-ago quarter to $135.76 million.
For the fiscal fourth quarter that ended December 31, 2022, net income attributable to CSIQ and earnings per share got here in at $77.83 million and $1.11, up 199.8% and 184.6% year-over-year, respectively.
Analysts expect CSIQ’s EPS to extend 16% year-over-year to $1.24 for the fiscal second quarter ending June 2023. The corporate’s revenue for a similar quarter is anticipated to extend marginally year-over-year to $2.32 billion. The corporate surpassed the consensus EPS estimates in each of the trailing 4 quarters, which is impressive.
The stock has gained 14% over the past 12 months and 22.3% over the past six months to shut its last trading session at $38.85.
CSIQ’s POWR Ratings reflect its promising outlook. It has an overall B rating representing Buy in our proprietary rating system. The POWR Rankings assess stocks by 118 various factors, each with its own weighting.
CSIQ has an A grade for Value and a B for Growth. It’s ranked first amongst 17 stocks within the Solar industry.
Beyond what we’ve got mentioned above, one can even see the extra POWR Rankings for CSIQ (Momentum, Stability, Sentiment, and Quality) here.
Westlake Chemical Partners LP (WLKP)
WKLP acquires, develops, and operates ethylene production facilities and related assets in the US. The corporate’s ethylene production facilities primarily convert ethane into ethylene. It sells ethylene co-products, including propylene, crude butadiene, pyrolysis gasoline, and hydrogen, on to third parties on a spot or contract basis.
On February 16, WLKP paid a quarterly dividend of $0.4714 per unit, marking the thirty fourth consecutive quarterly distribution to its unitholders. Its annual dividend of $1.89 yields 8.73% on prevailing prices. The corporate’s dividend payouts have increased at a 4.9% CAGR over the past five years.
WLKP’s trailing-12-month EBIT margin and EBITDA margin of 21.82% and 29.42% are 73.2% and 54.7% higher than the industry averages of 12.60% and 19.03%, respectively. Likewise, the stock’s trailing-12-month levered FCF margin of 20.05% is 333.4% higher than the industry average of 4.63%.
Through the fiscal fourth quarter that ended December 31, 2022, WLKP’s total net sales increased 11% year-over-year to $366.84 million. Net income attributable to WLKP partners and net income per limited partner unit attributable to WLKP partners amounted to $16.78 million and $0.48, respectively, for a similar quarter.
Its total liabilities stood at $468.27 million for the period that ended December 31, 2022, in comparison with $508 million in the identical period last 12 months.
Analysts expect WLKP’s revenue to extend 1.6% year-over-year to $1.62 billion for the fiscal 12 months ending December 2023. Its EPS for a similar 12 months is anticipated to are available in at $1.81. The corporate surpassed the consensus revenue estimates in three of the trailing 4 quarters, which is impressive.
Over the past five days, the stock has gained 1.3% to shut its last trading session at $21.50.
WLKP’s strong fundamentals are reflected in its POWR Rankings. The corporate has an overall A rating, which translates to a Strong Buy in our proprietary rating system.
The stock also has an A grade for Quality and a B for Value, Stability, and Sentiment. It’s ranked first within the B-rated 9-stock MLPs – Other industry.
Click here to see additional POWR Rankings of Growth and Momentum for WLKP.
Genie Energy Ltd. (GNE)
GNE and its subsidiaries supply electricity and natural gas to residential and small business customers internationally. It has three operational segments: Genie Retail Energy (GRE); GRE International; and Genie Renewables.
On March 27, Genie Renewables announced that it had acquired site rights to a community solar generation site in Upstate Recent York. Once built out and brought online, the proposed project is anticipated to have an aggregate generating capability of roughly 6.25 megawatts (MW).
Genie Renewables also announced that it received a good CESIR (Coordinated Electric System Interconnection Review) and estimate of interconnection cost from Con-Ed for its 3 MW proposed community solar project in Downstate Recent York. The corporate expects to receive its notice to proceed and start construction in the approaching months, subject to negotiating a land lease and obtaining local permits.
The corporate paid a dividend of $0.075 per share on March 1, 2023. Its current annual dividend of $0.30 yields 1.93% on prevailing prices. GNE’s four-year average dividend yield is 2.90%.
GNE’s trailing-12-month EBIT margin of 25.30% is 40.7% higher than the industry average of 17.98%. Likewise, the stock’s trailing-12-month net income margin of 27.83% is 158.8% higher than the industry average of 10.75%.
For the fiscal fourth quarter (ended December 31, 2022), GNE’s total revenue increased 17.6% year-over-year to $81.40 million. The corporate’s income from operations rose 167.2% year-over-year to $15.50 million, while its adjusted EBITDA increased 153.4% from the year-ago value to $18.50 million.
Also, its net income attributable to GNE common stockholders got here in at $16.20 million, and its earnings per share attributable to GNE common shareholder stood at $0.61 for the fiscal fourth quarter that ended December 31, 2022.
The stock has gained 137.2% over the past 12 months and 65.3% over the past six months to shut the last trading session at $15.80.
GNE’s solid prospects are reflected in its POWR Rankings. The stock has an overall rating of B, translating to Buy in our proprietary rating system.
It has a B grade for Value and Momentum. Throughout the Utilities – Domestic industry, it’s ranked second out of 64 stocks.
To see GNE’s rankings for Growth, Stability, Sentiment, and Quality, click here.
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CSIQ shares were unchanged in premarket trading Wednesday. 12 months-to-date, CSIQ has gained 25.73%, versus a 7.54% rise within the benchmark S&P 500 index through the same period.
In regards to the Writer: Sristi Suman Jayaswal
The stock market dynamics sparked Sristi’s interest during her school days, which led her to turn into a financial journalist. Investing in undervalued stocks with solid long-term growth prospects is her preferred strategy.
Having earned a master’s degree in Accounting and Finance, Sristi hopes to deepen her investment research experience and higher guide investors.
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