7 Solar Stocks That Could Make Your February Unforgettable
There are some great solar stocks to buy for February. These companies trade at attractive valuations and have great growth prospects.
Among these, firms that have demonstrated consistent revenue growth, strategic partnerships, and expansion into new markets are particularly noteworthy. Additionally, government policies and incentives aimed at boosting renewable energy adoption have played a significant role in creating this list of solar stocks to buy.
So here are seven solar stocks that investors should keep on their watchlists for an unforgettable 2024.
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SunPower (SPWR)
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SunPower (NASDAQ:SPWR) is an American company focused on household solar power devices in the U.S. and Canada.
I feel that now could be an ideal time for investors to pick up shares of SPWR stock. The company announced a GAAP revenue of $432 million and a net loss of $32 million for the quarter. Despite facing lower-than-expected consumer demand and delayed revenue recognition, SPWR managed to add 18,800 customers during this period.
However, there were some more positives revealed in SPWR’s earnings call.
SunPower reported a substantial backlog for retrofit installations, with over 18,100 customers awaiting service. The company also highlighted robust sales of its SunVault energy storage systems, with particularly high adoption rates in California.
With a price-to-sales ratio of just 0.4 times sales, SPWR is an undervalued pick, and remains as one of those solar stocks to buy.
Atlantica Sustainable Infrastructure (AY)
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Atlantica Sustainable Infrastructure (NASDAQ:AY) is a global energy company that has a portfolio that includes renewable energy, natural gas, electric transmission, and water assets.
The company remained in a reported solid financial position last quarter, with revenues and EBITDA remaining stable at $858.6 million and $627.3 million, respectively. The company highlighted a year-over-year (YOY) growth in cash available for distribution by 2.9% (or 0.6% on a comparable basis), reaching $184.2 million in the first nine months of 2023.
Furthermore, the company has successfully signed two Power Purchase Agreements (PPAs) in California, expecting higher returns than initially projected.
Analysts have a positive outlook on Atlantica, with a “Buy” consensus and a 12-month stock price forecast that suggests a 33.53% increase from the latest price.
Nextracker (NXT)
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Nextracker (NASDAQ:NXT) offers integrated solar tracker and software solutions to enhance energy harvest from solar power systems.
The company reported significant growth in its financial results for the third quarter of fiscal year 2024, showcasing strong performance and forward momentum in the solar energy sector. The company achieved a revenue of $710 million, marking a 38% increase YOY. Its GAAP net income stood at $128 million, with diluted earnings per share (EPS) at 87 cents.
Looking ahead, the company raised its fiscal 2024 guidance. The company now forecasts adjusted EBITDA to be between $475 million and $500 million, up from the previous range of $390 million to $440 million. Adjusted diluted EPS is expected to be between $2.55 and $2.75, marking an increase from the earlier projection of $1.95 to $2.15.
Thus, I think investing in NXT could be accretive for investors as the company is forecasted to grow earnings by 28.26% per year.
Canadian Solar (CSIQ)
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Canadian Solar (NASDAQ:CSIQ) deals with the manufacturing of solar PV modules and the provision of solar energy solutions.
Like the other solar companies on this list, I feel that CSIQ could be a good pick for investors.
The brand recently reported Q3 2023 results with a 39% YOY increase in solar module shipments to 8.3 GW. Net revenues reached $1.85 billion with a 16.7% gross margin and net income attributable to Canadian Solar shareholders of $22 million, or 32 cents per diluted share.
The company also provided Q4 2023 guidance with expected solar module shipments between 7.6 GW to 8.1 GW and e-STORAGE shipments between 1.4 GWh to 1.5 GWh.
Analysts believe that the stock’s valuation could rise 44.60% within the next twelve months.
Altus Power (AMPS)
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Altus Power (NYSE:AMPS) develops and operates solar generation, energy storage, and electric vehicle charging infrastructure across the U.S.
AMPS is also coming off a strong quarter. The brand reported third-quarter 2023 revenues of $45.1 million, a 48% increase from the same quarter in 2022, with a GAAP net income of $6.8 million, marking a significant improvement from the previous year.
The company reaffirmed its 2023 adjusted EBITDA guidance of $97-103 million, indicating a strong growth trajectory. Additionally, Altus Power is advancing the completion of approximately 75 MW of new assets.
Several analysts have rated AMPs as a “Buy” or “Strong buy” over the last few months. Most recently, Christopher Souther from B. Riley Securities gave it a “Strong buy” rating and a price target of $10, representing a 37.55% upside.
Shoals Technologies (SHLS)
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Shoals Technologies (NASDAQ:SHLS) produces electrical balance of system solutions for solar energy projects. There’s also some good news for this company. A large backlog and high demand for the company’s offerings suggest that orders placed in 2024 may not be fulfilled until 2025 or 2026.
Furthermore, SHLS reported net income projections of $46 million for 2023 and $122 million for 2024. The company’s valuation metrics, including EV sales and P/E ratios, indicate a transition towards higher profitability and efficiency in the coming year.
Recent analyst recommendations for SHLS include an upgrade by Barclays to “Equalweight” with a price target cut to $15 from $17, while Morgan Stanley maintained an “Equalweight” rating but reduced its price target to $17 from $21.
The company is 55.58% undervalued from its current stock price, according to analyst consensus targets.
Sunrun (RUN)
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Sunrun (NASDAQ:RUN) is a provider of residential solar, battery storage, and energy services in the U.S.
In 2023, Sunrun reported a 20% growth in customer additions in the second quarter, with total customers reaching 869,464, including 724,784 subscribers. The company installed 296.6 MW of solar energy capacity and 102.6 MWh of storage capacity during the same period.
Additionally, the company expects to continue benefiting from potentially decreasing interest rates, which could make its solar products more competitive against rising utility prices. This advantage should bolster product sales.
Sunrun’s “clean energy as a subscription” business model and leadership position in the U.S. residential solar market have analysts feeling optimistic about the stock. It has a rating of “Buy” as well as a price target of 53.24%.
On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Matthew started writing coverage of the financial markets during the crypto boom of 2017 and was also a team member of several fintech startups. He then started writing about Australian and U.S. equities for various publications. His work has appeared in MarketBeat, FXStreet, Cryptoslate, Seeking Alpha, and the New Scientist magazine, among others.
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