As the US transitions to clean energy by implementing electric vehicle subsidies and electrical grid updates, Yahoo Finance's Ines Ferré breaks down three stocks that are best positioned to receive a clean energy boost.
Higher interest rates last year put pressure on the clean energy sector, but increasing electricity demand is expected to benefit companies working on renewables this year. Coupled with Inflation Reduction Act (IRA) funding, the sector is already seeing accelerated production.
On the turbine front, Ferré points to the success of GE Vernova (GEV), which recently spun off from General Electric (GE). The stock is up 17% since going public, and analysts continue to remain bullish due to increasing investments in the nation's electrical grids.
She also highlights First Solar (FSLR), the largest supplier of domestically produced solar modules, with a backlog that will continue into 2027. First Solar has also secured major direct partnerships with data centers like Microsoft.
In the utilities sector, NextEra Energy (NEE) is up 19% year-to-date. The company delivers energy through renewables, natural gas, and nuclear power. In its most recent earnings call, the CEO pointed to the domestication of industries in the US as a major tailwind, alongside data center energy usage.
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This post was written by Melanie Riehl
Video Transcript
The sector in focus on Wall Street today.But the clean energy transition in the US going well beyond cars, it also involves upgrading the electrical grid to support increased power demand for A I and data centers.So which companies will likely benefit from that transition?Yahoo Finance has the list for us.Hey, hey ma yeah, we saw how higher interest rates last year put pressure on the clean energy sector but surging electricity demand is expected to benefit companies working on renewable.So this year is different, improving infrastructure incentives from the government's Inflation Reduction Act, the IRA that is aimed at accelerating the transition to green, domestically produced technologies are also expected to lift the sector.So which of the companies are we looking at?Well on a clean energy chart here, you can see Ver Nova, this is the company that just recently spun off out of GE and the stock is up seven percent since going public.This is a renewable energy company.They make gas turbines, they make wind turbines and analysts are bullish on this stock because of increasing electricity demand and also grid investments.You've got seven buys, four hold and one cell on this stock.We're also taking a look, by the way, this is a year to date chart.We're also taking a look at first solar.This is the biggest, the largest supplier of domestically produced solar modules.Their backlog goes into 2027 year to date.The stock is up 11% Goldman Sachs.Recently in a note talking about how for solar also has in direct partnerships with data centers like Microsoft, for example, so bullish on that stock.And then we're also taking a look at the utility space which by the way, utilities is the third best performing sector out of the S and P 500 this year.And we are taking a look at next era energy up a year to date up 19%.This company delivers energy that's in, in the form of renewables and natural gas, also nuclear and their CEO in their latest earnings call talked about the redation of industries in the US being a tailor for this company.Data center energy usage also being a tailwind for this company.17 buys five hold and one sell.So while we do see in the overall renewable space, we are still seeing weakness in that area.We are seeing companies that are these bright spots uh within that space, especially with the expectation of interest rates being cut later this year, guys, some that are well positioned here potentially for the coming years.All right.And that great stuff.Thanks.
