The future is bright not just for the technology implementation for renewable energy resources but also a great time to invest in their stocks. You will see more intelligent homes, EVs in the market, and solutions to make life easier and more sustainable. So naturally, it is a great motivation to join the decarbonization of our society, and what is the best way to support the cause and make a profit along the way?
Let's go over why it is good to invest in renewable energy or green stocks, what it entails for you, and if there are some great stocks you should invest in.
What are Green Energy Investments and Stocks?
When we talk about green energy, we mean everything not tied to fossil fuel as their fuel source. Every bit of energy you use can be renewable and can replace fossil fuels in the future without devastating effects on our planet. The most common forms of green energy are wind energy from wind turbines, solar panels, hydroelectric power from dams, and other similar resources. These energy resources are currently taking up a 20% share of the US energy power sector, slated to increase and maximize by 2050.
What are Some Types of Green Stocks and Energy Investments?
Instead of looking for the best companies, you should understand the broader categorization of green stocks. Understanding this will help you know what companies focus on and choose which are best for you.
Clean Energy Funds
This broad umbrella tracks different green energy ETFs, amounting to $270 million, and can include anything from improved battery storage to solar power.
Solar and Wind ETFs
These funds solely cater to solar and wind investments in manufacturing, supply, installation, etc. So, investing in these ETFs will help you gain increased profits, as significant investors are dumping tons of money for manufacturers.
Hydroelectric Investment
Making up for almost 20% of the world's total energy production, hydropower is here to stay and slated to grow the most in the renewable energy sector. So, keep looking for energy production companies that produce hydropower turbine-backed energy.
Why Should You Invest in Green Stocks to Earn Green Profits?
To minimize carbon emissions and footprint, globally, governments and companies are following net carbon neutrality policies, which ask for more investment in renewable energy. Before, it might seem counterproductive due to their high costs, but now, they are much better and are cheaper to adopt on a mass scale. Whether solar panels, batteries for storing energy, alternative options, or more, there is much more open to the public than ever.
So, when companies and governments are investing in these technologies globally, it is viable to start investing in their stocks. With the increased support and availability of green technology, more investors will jump into its support. So, investing now will see green profits in the years to come.
Top Green Energy Stocks to Invest
Here is the top of the crop when it comes to companies focusing heavily on green energy, so it is viable to invest in these companies and gain profit from the investment megatrend.
1.NextEra Energy
Their current stock price is $68.92, with an increase of 0.31% and a market cap of $139B. NextEra Energy is one of the biggest suppliers and producers of green energy operating from Florida, and you will find very few competitors. If you look at their track, they have made it possible to get 669% returns, providing steady growth to their investors. The same is true for its annual dividend rate, which is now 9.9%.
2.GE, General Electric
Who has yet to hear of GE, which has been on the front of power generation, cutting-edge research and development technology, and specialized manufacturing? With their recent GE Vernova outgrowth and market value of $99.8B, GE is poised to become the best in the renewable energy market. It will take at least 2-3 years to break even, but this is the best time to invest in Vernova stocks, as in a few years, it will be the best return on investment.
3.BEP, Brookfield Renewable Partners
BEP is one of the biggest publicly traded companies in the US and, now operating in more locations, is known for giving the highest dividends. Even though they are facing a downward trend with a recent collaboration with Cameco, you can get 70% more operating margins in months to come.
At the moment, their stock price is $28.8, with a drop of 1.57% for today but with a market cap of $18.93B; analyst comment that they are a strong buy for the next coming months.
4.ENPH, Enphase Energy
You can get a regular return on your investment because Enphase sees 60% of its equity as returns; it is now performing better than 89% of its peers. They are a Fermont-based company focusing on micro inverters for solar panels and residential energy storage solutions in the shape of batteries.
Tesla
No matter if there are a few misadventures of Elon Musk in the Twitter sphere, Tesla is seeing 31% growth this year, with their shares steady at $183.5. Due to some decline in their claims due to the cost of manufacturing EVs, the trend will increase in the coming years. It is not just their EVs seeing growth; expect more positive changes in their batteries and solar panel business.
Ending Thoughts
Renewable energy technologies and power generation have been considerably boosted in the last few years, even due to COVID-19. It has also seen a great rate of return on green stocks investment. It is high time when you can invest in green stocks, as there is already a significant increase in big investors injecting their wealth into this sector.
There is a higher trend and anticipation for it to grow, but like any other trend or business, it is likely to decline. It is better to research, make notes, consult with professionals, and invest when you think the time is right.
