Clean Energy Stocks For 2021 - oil price

An Oilprice.com Exclusive Report

The Top 10 Clean Energy Stocks For 2021

The Top 10 Clean Energy Stocks For 2021 22

This is where it all moves from pure enthusiasm to market reality …

We’ll talk about the great transformation …. the clean energy revolution and its myriad catalysts that are all lining up

simultaneously for true growth potential … but the key to investing in renewable energy requires a state of mind that is

rather more modern that many investors tend to be.

Betting on renewable energy isn’t about crunching profit numbers and counting everything that comes off the assembly

line. It’s not always about fundamentals—yet.

It’s a leap of faith, and one that stands to be extremely rewarding for investors willing to hedge on a grand idea … not a

balance sheet. And in this case, the “grand idea” is indeed … grand. It was already riding some serious tailwinds prior

to the global pandemic. Then it shifted into overdrive and we are convinced it will remain there.

Tesla should have painted a clear enough picture of how the “modern” way of thinking goes—and how much it can be

rewarded. The world is changing. As investors, we can change with it and even stay ahead of it by investing in stocks

that represent our energy future rather than our energy past.

Alternatively, we can plod along with marginal rewards for steadfastness.

Again, it’s a state of mind, and the stocks we will be examining in this report largely—but not exclusively--fall into the

“modern” state of mind: Major potential growth rather than presently sound fundamentals.

The State of Mind


The State of Play

The transformation of our energy systems from reliance on high-carbon fuels like oil, coal and gas towards carbon-neu-

tral energy sources such as wind, solar and geothermal heat is well and truly underway.

Renewable power is booming, as innovation brings down costs and drives the electrification of large sectors of the

economy such as transport and heating.

A November HYPERLINK “https://www.iea.org/reports/renewables-2020”IEA report found that almost 90% of new

electricity generation in 2020 was renewable, with just 10% powered by gas and coal.


The International Energy Agency has predicted that green electricity will end coal’s 50-year reign by 2025.

Even Big Oil is on board …

The inexorable march of renewables has continued to gather momentum during the ongoing pandemic, with renewable energy emerging as the energy sector most resilient to Covid19 lockdown measures.

Clean energy investors have been making money hand over fist, as investors continue to snap up the iShares S&P Global Clean Energy Index ETF (NASDAQ:ICLN)--a catch-all bet on clean energy.

The slim majority the Democrats have won in the Senate is likely to enhance President-elect Joe Biden’s chances of fulfilling his pledge to promote clean energy and EVs though sweeping legislation, such as his $5-trillion climate plan, are still on ice.

ICLN, a fund that offers broad exposure to companies that produce energy from renewable sources, has racked up handsome gains to the tune of 178% over the past 12 months. ICLN’s top three holdings are Plug Power (NAS-DAQ:PLUG), Enphase Energy (NASDAQ:ENPH) and Meridian Energy (OTC:MDDNF), which speaks volumes about

where things are headed.

With this in mind ….


#1 NEXT ERA ENERGY

Over the past 15 years, the world has been rapidly shift-

ing to cleaner electricity, and few, if any, companies have

navigated this transition in the U.S. better than Flori-

da-based utility giant, NextEra Inc. (NYSE:NEE).

NextEra has grown into the largest electric utility not

only in the U.S. but the entire world, thanks to its for-

ward-thinking management that has wisely deployed the

company’s stable cash flows from its regulated Florida

power utility (70% of revenue) to help into renewable in-

vestments (currently 30% of revenue).

The company’s renewables unit, NextEra Energy Re-

sources, is the largest generator of wind power in North

America, generating 42,807,582 MWh of wind power in

2019 and another 7,059,936 MWh of solar.

NextEra has also drawn up plans to develop Wall Street’s

latest renewable darling: Hydrogen.

During its second quarter earnings call, NextEra’s CFO

Rebecca Kujawa said the company is “...particularly ex-

cited about the long-term potential of hydrogen” and dis-

cussed plans to start a pilot hydrogen project at one of its

generating stations at Okeechobee Clean Energy Center

owned by its subsidiary, Florida Power & Light (FPL).

Every step of the way, NextEra seems to have been

ahead of the game, and that’s been very rewarding for

investors throughout 2020. We see even more catalysts

ahead for 2021.

If you had invested in NEE stock a decade ago, you

would be sitting on 520% return--a truly phenomenal

return for an energy company.

By contrast, a similar investment in ExxonMobil Corp.

(NYSE:XOM) you have seen your investment lose 25%

after factoring in dividends.

NextEra’s dividend (currently yields 1.73%) is considered

as safe as investment-grade bonds.

The TOP 10Renewable Energy Stocks For 2021

Jumping in on NEE a decade ago would have meant a 520% return today, blowing away

pretty much any mainstream energy offering.


While NextEra ranks #1 on our list of renewable energy stocks for 2021, adding an alternative that hasn’t already

shot through the roof isn’t a bad idea, either …

Alternative Buy: Algonquin Power & Utilities Corp.

With a P/E GAAP (TTM) of 40.98 against a sector median of 20.60, NEE stock is decidedly expensive.

Value investors searching for a comparable but cheaper al-ternative might want to consider Algonquin Power & Util-ities Corp. (NYSE:AQN) with P/E GAAP (TTM) of 21.20.

Algonquin Power owns and operates a portfolio of elec-tricity generation, distribution, and transmission utility assets in the United States and Canada and the United States. It generates and sells electrical energy through non-regulated renewable and clean energy power gener-ation facilities. And just like its bigger peer, the utility has been rapidly expanding its renewable generation portfolio including hydroelectric, solar, wind, and thermal facilities.

In December 2020, Algonquin Power agreed to acquire a 50% stake in a portfolio of four wind facilities in Texas with an aggregate capacity of 861 MW from RWE Group (OTCPK:RWEOY) at price corresponding to an enterprise value of ~$600M.

#2Tesla

With the electrification drive in full swing, the EV sector

has lately been sizzling hot. The de facto leader of the

space, Tesla Inc. (NASDAQ:TSLA), has been running

amok, with TSLA stock up nearly 800% over 52 weeks,

giving the EV maker a market cap of $834 billion as of the

second week of January 2021.

Tesla appears to have earned its stripes, though—even if

plenty would still disagree, and even though short-sellers

have consistently lost on this one.

For years, naysayers and short-sellers like Citron Re-

search were willing to bet the house that Elon Musk’s

high-wire act wouldn’t end well, with the preordained de-

nouement being a bankruptcy or a sale.

But those speculations were short-lived: Tesla and Musk

quickly proved to the world that there’s robust demand

for EVs and the future truly is electric.

The company has lately been defying bearish expecta-

tions that historically low oil prices would weaken its val-

ue proposition as it seeks to displace the internal com-

bustion engine.

Tesla has continued to beat delivery estimates, thanks

Tesla short-sellers lost a collective $40 billion in 2020 ...lesson learned?


to injecting its large-scale manufacturing capabilities into

Musk’s inspired improvisation. Tesla is now looking to

deliver an astounding 1 million EVs in 2021, double the

1M tally for 2020.

In its latest shareholder letter, Tesla revealed that its Fre-

mont, California factory can churn out 500,000 Model 3 +

Y units and another 90,0000 Model S + X units per year.

Meanwhile, Tesla’s new Shanghai factory has ramped up

capacity at an incredible clip and now has the capacity

for 250,000 Model 3 vehicles annually. Adding that up

brings us to Ferragu’s lowball estimate of 840,000 deliv-

eries in 2021.

But Tesla has a number of other gigafactories in the pipe-

line, which could significantly increase its production ca-

pacity as the quarters roll on: A Model Y factory in Austin,

Texas and a similar one in Berlin, Germany, with both

under construction. Meanwhile, the company is adding a

Model Y production line at its Shanghai factory.

Although Tesla has repeatedly missed deadlines in the

past, the Shanghai plant was built and began vehicle as-

sembly in just under a year.

The bulls are, therefore, betting that two upcoming fac-

tories and the new Model Y plant in Shanghai will be

completed before the end of the year and possibly ramp

up capacity rapidly enough for Tesla to hit the magical

1M deliveries as early as 2021.

Biden has unveiled a plan to build 500,000 new EV

charging stations, a move that could spur sales of ~25M

EVs in the coming years. Tesla will no doubt be one of the

biggest beneficiaries of that government largesse.

Tesla’s parabolic rally and apparent overvaluation does

not appear to deter Wall Street, with Bank of America re-

cently assigning a new price objective of $900 to TSLA,

good for 8.5% upside.

The alternative could potentially be exciting, too …

Alternative Buy: Fisker

At 23X EV/sales and 118x EV/EBITDA, Tesla’s valuation is

hard to wrap your head around...even for diehard bulls.

Fisker, Inc.(NYSE:FSR), a company that designs and

manufactures electric vehicles and mobility solutions,

could reward investors with the same phenomenal re-

turns that early Tesla investors have enjoyed.

Fisker Inc. is the relaunch of the Fisker brand that was

founded by Henrik Fisker in 2007.

In addition to designing and developing EVs, Fisker has

filed patents pertaining to solid-state battery technology

for use in automotive and consumer electronics. How-

ever, at this juncture, Fisker remains a speculative play

since it won’t start production of EV SUVs until 2023, and

probably won’t start making serious cash until late 2021

on advance orders.


Does that sound familiar?

It should.

It’s reminiscent of the early Tesla story in many ways.

Fisker stock has made a giant leap over the past month

after Citi Group initiated coverage on the company with

a $26 price target. FSR stock has gained 44.2% in the

year-to-date and now boasts a $4.1B market cap.

Fisker has four long-term advantages here:

• It’s making an SUV (a strong segment)

• It’s got a strong brand and it’s got automotive design legacy with Henrik Fisker.

• It’s a massive saver of capital because it has an inno-vative “asset-light” approach, getting Magna Interna-tional to assemble its first vehicle.

• It’s also taking EVs to a new level: Fisker’s Ocean SUV isn’t just an EV, it’s made from recycled materials.

Fisker has already garnered 9,000 pre-orders … fully pre-

paid. And when it does come out with its first Ocean SUV,

it will be at an affordable $40,000 price point and a super

flexible lease set-up that could be incredibly disruptive…

The rather long wait before its first EVs start rolling off

production lines has some analysts sitting on the side-

lines, though.

Goldman Sachs has initiated Fisker with a ‘Neutral’ rat-

ing and a $15 price target, noting the world-class design

talent at the firm but holding back due to the anticipated

length of time before products arrive. Still, this could turn

out like Tesla’s early days...meaning incredible profits for

early-in investors willing to play the long game.

We can wait.

#3

Enphase

Enphase Energy Inc. (NASDAQ:ENPH) is a Fremont,

California-based company that designs and manufac-

tures software-driven home energy solutions used in


solar generation, home energy storage and web-based

monitoring and control.

A big reason why ENPH stock is up 570% in 12 months

and 6,840% in five years is because the company oper-

ates in the most profitable segment of the solar supply

chain: Smart Inverters and Battery Storage.

Both these products require higher levels of innovation

and thus offer more room for a company like Enphase to

showcase its superior IP.

Enphase is regarded as one of the leaders in smart in-

verters which allows its products to command premium

prices. For instance, ENPH recently unveiled a strategic

partnership with solar module manufacturer Sonnen-

stromfabrik to develop the first high-efficiency Enphase

Energized AC module for the European residential solar

market.

In fact, Enphase is one of a handful of solar companies

that can boast of being solidly profitable, with a gross

margin comfortably north of 40%--about 10 percentage

points higher than its closest peer SolarEdge Technol-

ogies Inc. (NASDAQ:SEDG).

Despite all of this, Wall Street’s verdict on ENPH is a

mixed bag.

Raymond James and Susquehanna have recently down-

graded the stock with Raymond James analyst Pavel

Molchanov labeling the maker of solar inverters as a

“textbook example of overly euphoric sentiment.”

Susquehanna’s alternative energy analyst Biju Perincher-

il has also downgraded ENPH to Neutral from Positive,

citing stretched valuations. Perincheril has assigned new

price targets of $195 for ENPH, suggesting 6% down-

side.

Not everybody has bailed on Enphase, though. Goldman

Sachs has upgraded the stock, citing a shifting prefer-

ence toward residential solar and battery exposure.

Overall, ENPH still carries a Buy rating on The Street

though the consensus price target of $132.46 suggests

a potential 34.3% downside.

Alternative Buy: SunPower Corp.

Sunpower Corp.(NASDAQ:SPWR) is an American ener-

gy company that manufactures crystalline silicon photo-

voltaic cells and solar panels based on an all-back-con-

tact solar cell technology.

SunPower is an old head in the solar industry and has

tried its hand at many aspects of the business.

Enphase is up 570% in 12 months and over 6,800% in five years, and

it’s solidly profitable


However, the company’s latest act involves becoming a

more specialized player in solar technology, after selling its

microinverters business to Enphase in 2018 and completing

the acquisition of Maxeon (NASDAQ:MAXN) last August.

A key benefit of this strategy has been a reduction in Sun-

Power’s cost of capital and a healthier balance sheet. It’s

too early to tell whether SunPower’s streamlining efforts

will pay off in the long run but if you love a good turn-

around story, this company might be a good buy.

#4 First Solar

First Solar (NASDAQ:FSLR) IS America’s largest solar

manufacturer and the third-largest in the world with rev-

enue (TTM) of $3.1 billion.

First Solar manufactures solar panels, photovoltaic pow-

er plants, and related services including construction,

maintenance, and recycling of solar products. The Tem-

pe, Arizona-based company employs thin film semicon-

ductor technology to achieve enhanced efficiency and

sustainability in its solar modules.

First Solar has been removed from Goldman Sachs’ Con-

viction List mainly due to lower exposure to fast-growing

solar markets in China, India and Asia (75% of the com-

pany’s orders come from the U.S.).

Others, such as Raymond James have moved to the side-

lines on fears that First Solar might come under pressure

if Biden repeals Section 201 tariffs that Trump placed on

imported solar modules from China, while Morgan Stan-

ley and J.P. Morgan have downgraded the stock after its

recent run-up to multiyear highs (FSLR is up 67.2% YTD).

Nevertheless, FSLR remains fundamentally sound and a

top player in the industry.

During the latest earnings, the company reported Q3 rev-

enue of $928M (+69.7% Y/Y) and GAAP EPS of $1.45,

both metrics easily beating Wall Street expectations.

More importantly, FSLR has a stronger balance sheet

than most of its peers, with an impressive current ratio

of 3.66 compared to 1.04 by JinkoSolar (NYSE:JKS),

1.14 by Canadian Solar (NASDAQ:CSIQ) and 0.47 for

Daqo New Energy (NYSE:DQ).

Alternative Buy: SunRun

Sunrun Inc. is a United States-based provider of resi-

dential solar electricity, headquartered in San Francisco,

California.

Back in July, Sunrun announced that it would acquire

rival Vivint Solar (NYSE:VSLR), in an all-stock deal val-

ued at $3.2B including debt. Sunrun sealed the deal in

October, with management guiding for cost savings of

$90 million thanks to synergies created by the merger.

The merger created a behemoth with about 500K cus-


tomers, beating Tesla Inc.’s (NASDAQ:TSLA) residential

solar business in scale and easily making it one of the

world’s largest providers of solar equipment.

According to UBS Research, Tesla was the leader of the

residential solar space in 2019, accounting for 14% of

all U.S. residential solar installations thanks to its 2016

acquisition of SolarCity. The Sunrun-Vivint Solar combo

will, however, now top that with a 16% slice of the market.

Jinjoo Lee of the WSJ says the larger scale of the new

entity might eventually help tackle Sunrun’s “soft costs”

such as customer acquisition costs, labor and permits.

#5 Canadian Solar

Canadian Solar (NASDAQ:CSIQ) manufactures solar

PV modules and runs large scale solar projects through

two segments, Module and System Solutions (MSS), and

Energy. The company’s energy solution products include

solar inverters and energy storage systems.

Based in Guelph, Canada, Canadian Solar is currently

ranked as the fifth-largest solar PV manufacturer in the

world by volume with nearly 10GW of panels produced

in 2019 and one of the ‘most bankable’ manufacturers.

Like many solar names, CSIQ has enjoyed a banner year,

climbing 149% over the past 12 months. However, the

company appears to have room to run thanks to contin-

ued macro tailwinds support including vertical integra-

tion, module capacity expansion as well as a growing

and stabilizing project development business. Further,

the company has considerable upside potential thanks

to its position as an early mover in the development of

utility-scale energy storage projects.

But, perhaps, best of all, CSIQ remains cheaper than

most of its peers probably because it’s been growing at

a slower but steady pace.

Alternative Buy: SolarEdge

SolarEdge Technologies Inc. (NASDAQ:SEDG) is an

Israel-based provider of power optimizers, solar invert-

ers and monitoring systems for solar PV systems. The

company has demonstrated strong revenue momentum,

posting 42% CAGR over the past three years.

SEGD stock has surged 237% over 52 weeks as the mar-

ket continues to reward it for a successful transition from

a manufacturer of solar inverters to a vertically integrated

distributed energy business.

SolarEdge’s current suite of solutions includes grid ser-

vices, energy storage, and energy management. Al-

though the majority of these solutions are built around

the company’s legacy inverter and power optimizer prod-

A $3.2-billion merger of Sunrun and rival Vivint Solar creates a behemoth worth

keeping a close eye on in 2021 and beyond

CSIQ gained nearly 150% in 2020 and there’s still room to run for this early mover


ucts, they are still relatively newer solutions that expand

the company’s addressable market.

Last year, B. Riley initiated coverage of SolarEdge with a

‘Buy’ rating, saying the company is “best positioned play-

er to address multiple end markets and geographies with

improved functionality and competitive pricing on the resi-

dential side and with new products to address larger proj-

ects in the commercial and utility-scale segments.”

#6 Vestas

Vestas Wind Systems (OTCPK:VWDRY) is the world’s

largest wind power company, responsible for more wind

turbine installations than any other company, estimated

at 70,000 turbines in 80 countries. Apart from the tur-

bines, this Denmark-based company services more than

40,000 turbines and delivers approximately 800,000

wind turbine parts annually.

Whereas Vestas is the undisputed global leader in on-

shore wind, the company is now making decisive steps

to also take the lead in offshore wind.

The company has agreed to acquire Mitsubishi’s 50%

stake in offshore segment MHI Vestas for EUR 709 mm

which appears like a fairly valued deal considering MHI

Vestas has annual revenue of approximately EUR 1.4 B.

Offshore wind is just taking off globally with installed ca-

pacity expected to increase sharply in the second half of

the current decade.

MHI Vestas has 3.9 GW in firm orders now and another

1.3 GW of conditional orders, a nice addition to Vestas’

16.2 GW backlog and 118 GW installed capacity.

Vestas and Mitsubishi have also agreed to collaborate on

green hydrogen production which makes sense now that

a consortium of European energy giants have vowed to

bring down green hydrogen prices to $2/kg over the next

couple of years.

On the other hand, the hydrogen boom is likely to provide

a significant boost to renewable energy in some sort of

virtuous cycle by creating substantial investment oppor-

tunities for solar and wind energy, the scaling of which

could lower hydrogen production costs even further.

Offshore wind is just picking up speed globally, and Vestas is

well-positioned to benefit in 2021, but watch the tie-in to the hydrogen

boom, as well


Alternative Buy: American Supercon-ductor Corp.

American Superconductor Corporation (NAS-

DAQ:AMSC) is a Massachusetts-based provider of

megawatt-scale power resiliency solutions to global cus-

tomers.

The company’s Wind segment designs wind turbine sys-

tems and licenses them to third parties under the Wind-

tec Solutions brand and also supplies power electron-

ics and software-based control systems to wind turbine

manufacturers.

The Grid segment offers products and services to elec-

tric utilities that help them connect, transmit, and dis-

tribute power their renewable power under the Gridtec

Solutions brand.

After a stagnant period, AMSC has been able to return to

growth, posting 50% revenue growth over the last quar-

ter. The company is expected to continue doing brisk

business with its topline expanding 40% over the next

two years.

AMSC has an Overweight rating with 3 ‘Buy’ ratings and

1 ‘Hold’ rating.

#7 Bloom Energy

Bloom Energy Corp. (NASDAQ:BE) was one of the

most exciting stocks of 2020.

It’s a clean energy innovator that designs, manufactures,

and sells solid-oxide fuel cell systems for on-site power

generation. It’s key product, the Bloom Energy Server,

is a stationary power generation platform that converts

standard low-pressure natural gas, biogas, or hydrogen

into electricity through an electrochemical process with-

out combustion.

Adding more fuel to the fire, so to speak, back in June,

Bloom announced plans to enter the commercial hydro-

gen market by introducing hydrogen-powered fuel cells

and electrolyzers that produce renewable hydrogen.

The timing could not have been better, with the hydrogen

sector on the verge of taking off and costs expected to

fall dramatically.

The Green Hydrogen Catapult Initiative is a brainchild of

founding partners Saudi clean energy group ACWA Pow-

er, Australian project developer CWP Renewables, Euro-

pean energy giants Iberdrola and Ørsted, Chinese wind

turbine manufacturer Envision, Italian gas group Snam,

and Yara, a Norwegian fertilizer producer.

The real game-changer herewill be success in driving 25GW of green

hydrogen production by 2026.


The companies hope to drive 25GW of green hydrogen

production by 2026, a scale that could significantly drive

down hydrogen costs to below $2/kg thus making the

fuel source competitive with fossil fuels in power gener-

ation. Green hydrogen is produced using renewables as

an energy source in the electrolysis of water.

Its late entry into the hydrogen market might allow BE to

ride the hydrogen wave at a profitable phase compared

to legacy companies that have printed red ink for many

years.

So far, the clean energy wave has been extremely kind

to Bloom investors. For 2020, investors saw gains of over

260%, with cautionary salvos that have lately slowed

those gains due to concerns of over-hyping hydrogen

and overvaluation. We think it’s still a smart play with

plenty of potential upside, but don’t necessarily expect a

repeat of 2020 in 2021. We might have to look a year or

two beyond that to see what Bloom can really do.

Alternative Buy: FuelCell Energy

Source: CNN Money

On the opposite side of the spectrum, FuelCell Energy

Inc.(NASDAQ:FCEL) has surged more than 628% over

the past 90 days alone and 62% YTD in what analysts

are calling a classic FOMO (Fear Of Missing Out) trade.

Perhaps it’s not a coincidence that the stock has been

rallying hard in the five weeks since Biden was declared

the next president of the United States. With Biden

pledging net-zero status by 2050 and looking to invest

nearly $2 trillion of Federal funds in clean energy if the

Democrats win the senate majority, the hydrogen sector

has good reason to be excited about what’s to come.

Still, FuelCell has managed to make a strong case for

the role its fuel cells could play in building microgrids by

highlighting how California utility regulators recently man-

dated Public Service Power Shutoffs (“PSPS”) in an effort

to avert wildfires led to widespread blackouts, hardship,

economic loss, hardship, and other more serious conse-

quences.

#8 Brookfield Renewable Partners

At a time when energy MLPs (Master Limited Partner-

ships) are mostly struggling, it comes as a breath of fresh

air to find one that is really flying.

Brookfield Renewable Partners LP (NYSE: BEP) is

an MLP that owns a portfolio of wind, solar, hydroelectric


and other green-energy properties. BEP has surged 85%

over the past 12 months and 10.3% YTD.

Recently, Plug Power (NASDAQ:PLUG) announced an

agreement to source 100% renewable energy supplies

from Brookfield Renewable Partners to fully energize its

planned green hydrogen production plant, one of the first

industrial-scale facilities in North America.

The hydrogen sector is one of the hottest corners of the

renewable energy sector right now with the hydrogen

market projected to hit $11 trillion over the next three de-

cades.

This makes Brookfield Renewable Partners LP-- a

60%-owned renewable-energy affiliate of Brookfield

Asset Management--one of the best stocks to own un-

der a Joe Biden presidency.

Alternative Buy: ICLN

The $5.5 billion (AUM) iShares Global Clean Energy

ETF (ICLN), a catch-all bet on clean energy, is the renew-

able energy sector’s largest ETF. Owned and managed

by BlackRock, ICLN invests in global stocks of compa-

nies operating across utilities, solar energy, wind alter-

native energy resources, hydroelectric power generation,

biofuels, independent power and renewable electricity

producers sectors.

ICLN’s top 5 holdings in order of weightings are:

• PlugPower--6.18%

• Enphase Energy--5.47%

• Meridian Energy--5.13%

• Xinyi Solar--5.08%

• Verbund AG--4.79%

ICLN invests in both growth and value stocks across di-

versified market capitalization, thus offering excellent ex-

posure to the global renewable energy ecosystem.

#9 Plug Power

New York-based PlugPower Inc. (NASDAQ:PLUG) en-

gages in the development of hydrogen fuel cell systems

that replace conventional batteries in equipment and ve-

hicles powered by electricity, such as forklifts.

PLUG has soared to its highest levels since the 2008 fi-

nancial crisis, boasting an imperious 1,200% return over

the past year and 60% already in the new year.

A cross-section of Wall Street is worried that hydrogen

stocks like PLUG could be in a serious bubble especially

considering that many companies in the space are still

printing red ink.

Still, investors cannot seem to get enough of the com-

pany--which is partly justifiable given PlugPower’s bright

prospects. After growing its topline 28% in 2020 amid

the pandemic, PlugPower is expected to record a 38%

revenue improvement in the current year to $410M.

We’ve talked about the hydrogen tie-in in several of these stocks,

and while it serves investors well to avoid getting caught up in hype, the market IS projected to hit $11T in the next three decades, and BEP

is throwing its hat in the ring.


Source: Seeking Alpha

Just two weeks into the New Year, and PlugPower has al-

ready completed two important pieces of business: a $1.5B

strategic investment from South Korea’s SK Group as well

as a 50-50 joint venture with French automaker Renault.

Under the SK deal, the Korean company will acquire

~51.4M common shares at ~$29.29/share, representing

a 9.9% pro forma ownership stake in Plug. The partner-

ship aims to accelerate hydrogen as an alternative ener-

gy source in Asian markets.

In the Renault deal, the companies will manufacture and

sell fuel cell-powered vehicles for the fast-growing fuel

cell light commercial vehicles, commercial people trans-

portation and taxis sectors.

The bulls clearly expect that PLUG will convert the hype

around hydrogen power into concrete orders and profits

over the coming years--and so far it has not disappointed.

Alternative Buy: Ballard Power Systems

Ballard Power Systems Inc. (NASDAQ:BLDP) is a

Canadian company that designs, develops, manufac-

tures and sells proton exchange membrane fuel cell

products. The company offers fuel cell stacks, heavy

duty modules, and portable power/ unmanned aerial ve-

hicles (UAV), backup power systems, and material han-

dling products.

Just like its peer, Ballard Power has been striking strate-

gic partnerships and bagging big deals.

Back in December, the company received follow-on

purchase orders from Van Hool, for fuel cell modules to

power Van Hool’s hydrogen buses under the JIVE2 fund-

ing program.

In early January, Ballard Power received purchase or-

ders by U.K.-based Arcola Energy, to supply fuel cell

modules to power a demo passenger train planned for

COP26, to be hosted by Glasgow City in November 2021.

#10 JinkoSolar

JinkoSolar Holding Co. (NYSE:JKS) is a Chinese solar

firm that engages in the design, production and market-

ing of photovoltaic products including silicon wafers, so-

lar modules, solar cells, and silicon ingots. The company

also provides solar system integration services including

development of commercial solar power projects.

Despite negative sentiment on Wall Street, JKS has con-

tinued to enjoy a strong rally on optimism that govern-

mental support for clean energy will lift all boats.

The bulls expect PLUG will actually convert all the hydrogen hype into

concrete deliverables... so stay tuned.


Jinko’s mid-to long-term prospects actually look good,

with solid opportunities in revenue growth and gross

margin expansion from easing of raw material constraints

and decreasing logistics costs.

Alternative Buy: Daqo New Energy

Daqo New Energy Corp. (NYSE:DQ) is, likewise, a Chi-

nese company. In this case it manufactures monocrystal-

line silicon and polysilicon solar PV systems.

Like many of its solar peers, DQ has enjoyed a terrific run,

racking up gains of 583% over the past 12 months and is

already up 33% in the year-to-date.

But despite the massive rally, DQ still looks considerably

cheaper than ENPH with a P/E GAAP (FWD) of 39.07 vs.

271.93 as well as EV/Sales (FWD) of 8.18 vs. 32.94.

But value is just one of DQ’s attractive points.

The company has been posting impressive top-and bot-

tom-line growth--a trend that appears poised to continue

in the coming years. In the last fiscal year, Daqo posted

revenue growth of 78.3% Y/Y, compared to a sector me-

dian of 5.71% while EBITDA improved 140.40% vs. 4.50%.

For the current year, DQ has projected revenue growth of

41.63% and EBITDA growth of 52.12%, much better than

the sector average of 6.96% and 8.99% for revenue and

EBITDA, respectively.

Daqo has mainly been benefiting from robust demand for

its products as well as rising polysilicon prices.

The company recently signed an agreement with JA So-

lar to supply 32,400−43,200 MT of polysilicon between

January 2021 and December 2023 and another 12,000

MT of polysilicon to a leading solar company from Janu-

ary 2021 to December 2022.

Daqo has a consensus Overweight rating on Wall Street

with 5 Buys, 2 Buy and 1 Hold ratings.

Stick with Oilprice.com and be sure to check out the sub-

scriber-only offerings. Throughout 2021, we’ll be tracking

all of these companies to deliver in-depth insight on hype

versus reality as the ‘green revolution’ gets underway in

earnest.

Clean Energy Stocks For 2021 - oil price

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