The increasing frequency of droughts, record number of wildfires, and floods are propelling governments worldwide to take more aggressive steps to transition their countries to renewable-energy-based sustainable economies. Yet, according to NOAA’s National Centers for Environmental Information data, July 2021 came in as the world’s hottest month, reflecting the growing intensity of the climate crisis.
While producing energy from renewable sources is still expensive, solar and wind energy costs have declined considerably over the past few years. According to The International Energy Agency (IEA), renewable energy capacity is set to expand 50% between 2019 - 2024. Furthermore, according to a Facts & Factors report, the global renewable energy market is expected to grow at a CAGR of more than 8% between 2021 - 2026.
Given this industry’s promising prospects, Wall Street analysts are highly optimistic about the near-term performance of renewable energy stocks Plug Power Inc. (PLUG), Canadian Solar Inc. (CSIQ), and Clean Energy Fuels Corp. (CLNE). So, it could be wise to scoop up these stocks now.
Plug Power Inc. (PLUG)
PLUG provides hydrogen fuel cell turnkey solutions for the electric mobility and stationary power markets in North America and Europe. The Latham, N.Y.-headquartered company focuses on proton exchange membrane fuel cell and fuel processing technologies, fuel cell/battery hybrid technologies, related hydrogen and green hydrogen generation, storage, and dispensing infrastructure.
On July 14, 2021, PLUG and Apex Clean Energy announced a 345 MW wind power purchase agreement and a green hydrogen production facility development services agreement. Andy Marsh, PLUG CEO, said, “This wind-powered green hydrogen plant is important to Plug Power’s customers and to achieving our generation targets of 500 tons per day by 2025 and 1,000 tons per day before 2028.”
PLUG’s net revenue surged 83% year-over-year to $124.60 million for its fiscal second quarter, ended June 30, 2021. Its gross billings grew 75% year-over-year to $126.30 million, and its total assets came in at $5.79 billion, representing a 157.1% sequential increase.
PLUG’s EPS is expected to increase 76.6% year-over-year in its fiscal year 2021. In addition, its revenue is expected to increase 51.6% year-over-year to $743.35 million in fiscal 2022. Over the past year, the stock has gained 105.5% in price, to close yesterday’s trading session at $26.41. Wall Street analysts expect the stock to hit $41.47 in the near term, which indicates a potential 57% upside.
Canadian Solar Inc. (CSIQ)
CSIQ, in West Guelph, Canada, designs, develops, manufactures, and sells solar ingots, wafers, cells, modules, and other solar power products. The company operates through two segments: Module and System Solutions (MSS); and Energy. Its primary customers include distributors, system integrators, project developers, and installers/EPC companies.
On August 10, 2021, Recurrent Energy, LLC, a wholly owned subsidiary of CSIQ, signed a 15-year Resource Adequacy agreement with Pacific Gas & Electric to provide 150MW/600MWh of energy storage in phase 2 of the Crimson project, beginning in the summer of 2022. This should help increase the company’s revenue.
For the fiscal second quarter, ended June 30, 2021, CSIQ’s top line increased 105% year-over-year to $1.43 billion. In addition, the company’s total module shipments grew 26% year-over-year to 3.66GW, while its gross profit increased 26% year-over-year to $185 million.
Analysts expect CSIQ’s EPS to increase 125.5% year-over-year to $3.54 in its fiscal year 2022. In addition, it surpassed the consensus EPS estimates in three of the trailing four quarters. The company’s revenue is expected to increase 66.5% year-over-year to $5.79 billion in its fiscal year 2021. The stock has soared 31.1% in price over the past year to close yesterday’s trading session at $36.33. Wall Street analysts expect the stock to hit $45 in the near term, which indicates a potential 23.9% upside.
Clean Energy Fuels Corp. (CLNE)
CLNE provides natural gas as an alternative fuel for vehicle fleets and related fueling solutions primarily in the United States and Canada. It supplies renewable natural gas, compressed natural gas, and liquefied natural gas for light-, medium-, and heavy-duty vehicles. In addition, it offers operation and maintenance services for public and private vehicle fleet customer stations. CLNE is based in Newport Beach, Calif.
CLNE announced a slew of new deals in response to the demand for renewable natural gas on August 17. Chad Lindholm, the company’s vice president, said, “Fleets that are looking to lower their emissions are switching to RNG because it can provide immediate and significant carbon reductions. They’re finding that RNG is the easiest and most cost-effective way to meet sustainability goals."
CLNE’s gallons delivered increased 13% year-over-year to 101.40 million for the second quarter, ended June 30, 2021. Its adjusted EBITDA grew 51.3% year-over-year to $13.96 million, while its non-GAAP net income came in at $1.76 million compared to a $4.47 million net loss in the prior-year period. Its non-GAAP EPS came in at $0.01 compared to a $0.02 loss per share in the year-ago period.
For the quarter ending September 30, 2021, analysts expect CLNE’s EPS to increase 200% year-over-year to $0.01. In addition, the company’s revenue is expected to increase 19.5% year-over-year to $362.03 million in fiscal 2022. Over the past year, the stock has gained 180.9% in price to close yesterday’s trading session at $7.81. Wall Street analysts expect the stock to hit $11 in the near term, which indicates a potential 40.8% upside.
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PLUG shares were trading at $26.17 per share on Thursday afternoon, down $0.24 (-0.91%). Year-to-date, PLUG has declined -22.83%, versus a 20.58% rise in the benchmark S&P 500 index during the same period.
About the Author: Nimesh Jaiswal
Nimesh Jaiswal's fervent interest in analyzing and interpreting financial data led him to a career as a financial analyst and journalist. The importance of financial statements in driving a stock’s price is the key approach that he follows while advising investors in his articles.
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