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The Zacks Analyst Blog Highlights: Ameresco, Sunrun, Vivint Solar, Bloom Energy and SolarEdge Technologies

Zacks Equity Research

For Immediate Release

Chicago, IL – July 10, 2020 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Ameresco AMRC, Sunrun RUN, Vivint Solar VSLR, Bloom Energy BE and SolarEdge Technologies SEDG.

Here are highlights from Thursday’s Analyst Blog:

4 Renewable Energy Stocks Returning More than 50% YTD

While the majority of industries are struggling to adapt to the “new normal” economic situation courtesy of the coronavirus outbreak, renewable remains one of the few witnessing a rally. Impressively, renewable electricity remained largely unaffected amid the pandemic, while demand fell for other uses of renewable energy.

Per a report by the International Energy Agency (IEA), in the first quarter of 2020, global use of renewable energy in all sectors increased by about 1.5% relative to the first quarter of 2019.

Solar and Wind in Focus

We observe that solar and wind energies have been leading the growth in global renewable space of late. Notably, the increase in global use of renewable energy during the first quarter was driven by a rise of about 3% in renewable electricity generation, after more than 100 GW of solar PV and about 60 GW of wind power projects were completed in 2019. Consequently, the share of renewables in global electricity generation jumped to nearly 28% in the first quarter of 2020 from 26% in the year-ago period.

It is imperative to mention in this context that while the need for adopting clean energy to avoid the adversities of greenhouse effect has been the primary catalyst driving renewables’ popularity as the fastest electricity generation source, rapidly plummeting cost of electricity generation has also been a reason. Such notable cost deceleration can be attributed to improved product design. For instance, wind turbines are now much larger and have much higher capacity factors. Another reason for the cost decline is improvement in manufacturing efficiency, which has lowered the cost of producing solar PV panels dramatically.

Has There Been No Real Impact of COVID-19?

One cannot assert that the pandemic had absolutely no impact on the renewable industry. Lockdown measures following the spread of the virus disrupted normal manufacturing rate of vital clean energy products like solar panels and wind turbines. As a result, the industry faced moderate supply chain disruptions. Also, there was a slowdown in installation activities to maintain social distance along with low electricity demand due to dearth of adequate economic activities.

Nevertheless, compared to other energy sources, renewables are resilient to lower electricity demand because they are generally dispatched before other electricity sources due to their cost effectiveness as well as regulations that give them priority. It is this resilience of the industry that has set it apart from other energy sources in this crisis situation.

Moreover, in most countries, the energy sector comes under the category of essential services. Therefore, lockdown measures did not lead to complete stalling of construction activity in energy projects, including renewables. So, the impact of the pandemic on the renewable space was relatively less compared to other major industries like airlines, commercial aerospace and transportation.

Stocks to Watch

Despite supply chain disruptions that have delayed activity in several key regions, IEA projects that expansion of solar, wind and hydro power will help renewable electricity generation to rise nearly 5% in 2020. This sets the stage for investors to be interested in renewable stocks.

We have selected four favorably-ranked renewable stocks that have returned more than 50% year to date, outperforming the broader market and thereby reflecting their resilience to the COVID-19 impacts. The fact that they also have quite an impressive long-term outlook makes them even more desirable.

Ameresco is a leading independent provider of comprehensive energy services and is currently designing and constructing a wide range of renewable energy plants using LFG, wastewater treatment biogas, solar, biomass, other bio-derived fuels, wind and hydro sources of energy. The shares of this Zacks Rank #1 (Strong Buy) company have returned 63.7% year-to-date against the Zacks S&P 500 composite’s decline of 2.1%. Its estimated long-term earnings growth rate is pegged at 17.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Sunrun is a leading provider of home solar panel and battery storage. It recently signed a $3.2 billion deal to take over Vivint Solar in an attempt to expand its footprint in the U.S. residential solar market. Shares of this Zacks Rank #2 (Buy) company have returned 104.7% year to date, while its estimated long-term earnings growth rate is pegged at 9.4%.

Bloom Energy’s proprietary solid oxide fuel cell technology, Bloom Energy Server is a stationary power generation platform capable of delivering highly reliable, uninterrupted, 24x7 power that is clean and sustainable. Shares of this Zacks Rank #2 company have returned 67.7% year to date, while its estimated long-term earnings growth rate is pegged at 25%.

SolarEdge Technologies is a leading solar PV inverter manufacturer, with presence in more than 130 nations. Shares of this Zacks Rank #3 (Hold) company have returned 66.1% year to date, while its estimated long-term earnings growth rate is pegged at 25%.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.


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Ameresco, Inc. (AMRC) : Free Stock Analysis Report
 
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