7 Best Green Energy Stocks to Buy


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Market value: $63.9billion2020 revenue: $2.5 billionCurrent ratio:2.5

Nio (NIO, $38.95) has been called the Tesla(TSLA) of China. It makes sleek and innovative vehicles boasting features such as floating car displays, two-spoke steering wheels, invisible smart air vents, massage seats, sensors, radar, soft-opening doors and autonomous driving.

A solid-state battery for its cars is coming in 2023 that will offer a 620-plus mile range, exceeding Tesla's top range. The company recently announced it was expanding into Norway, its first foray outside China and into Europe.


Nio recently beat June-quarter earnings estimates. Mizuho (Buy) says the firm delivered “overall strong execution with strong SepQ guide for deliveries, despite supply shortage overhangs.”

Earlier in August, BofA Securities raised its price target on NIO stock to $62 per share from $60 based on stronger electric-vehicle demand. It also reiterated its Buy rating, citing”solid volume sales; focus on autonomous driving, powertrain, and charging solution to enhance user experience; faster sales channe! l expansi! on; and continuous new model launches, which should help in share gain.”


Deutsche Bank analyst Edison Yu (Buy) believes Germany and Denmark could be the next destinations for Nio. Investors “underappreciate the longer-term potential of the region,” he says.

German and other European automakers traditionally dominate the continent's premium auto market. But EV's arrival opens an opportunity to grab share. Moreover, Nio is “localizing its entire ecosystem” instead of exporting its cars to Europe.

While it will not be easy for an unknown brand to gain ground in Europe, smaller and weaker automakers that find it hard to go electric could be vulnerable to Nio, Yu contends. Also, he says, the company's cars with its suite of features “could eventually resonate well with consumers.”


Analysts overall regard Nio as one of the best green energy stocks, with a fairly high-conviction consensus Buy rating at present.

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Hannon Armstrong Sustainable Infrastructure Capital”green


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Market value: $4.6 billion2020 revenue: $187 millionCurrent ratio: 23.4

Hannon Armstrong Sustainable Infrastructure Capital (HASI, $58.40) believes there are above-average returns to be reaped from investing in climate-friendly solutions.

It manages more than $7 billion in assets and exclusively invests in companies involved in energy efficiency, renewable energy and other sustainable infrastructure markets. Hannon believes in its mission so much that it requires companies seeking its capital to be neutral or negative in incremental carbon emissions or show other environmental benefits.


Baird analyst Ben Kallo says that “HASI continues to be a 'core' pick for investors looking to gain exposure to sustainable infrastructure and renewable energy growth.”

“2Q21 was another consistent quarter highlighted by very strong distributable EPS as well as significant transactions! closed, ! and a steady portfolio yield,” says Kallo (Outperform). “Management highlighted potential policy tailwinds, but policy and regulatory tailwinds would only accelerate HASI's growth as it does not depend on subsidies.”


Kallo adds that current guidance is for distributable earnings compound annual growth of between 7% to 10% between 2021 and 2023, with dividends per share expected to grow 3% to 5% annually in that same time frame.

The company has helped finance more than 450 sustainable infrastructure projects since 2000. Moreover, Hannon invests in projects that tend to be “relatively low risk with recurring and predictable cash flows.” It works with “high credit quality obligors” such as federal, state, and local governments, utilities and hospitals, the analyst says.


“Strong execution is already making the three-year guidance look very conservative two quarters into the first year,” adds B. Riley analyst Christopher Souther (Buy, $80 price target) who says the stock remains a “Vision Top Pick” for 2021.

Overall, the consensus rating for HASI shares is Buy.

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Ford ”Ford


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Market value: $52.6billion2020 revenue: $127.1 billionCurrent ratio: 1.2

Call it ironic or plain brilliant, butFord (F, $13.17) one of the world's largest automakers whose founder Henry Ford brought the gasoline-powered automobile to the masses is doubling down on going green.

No doubt it saw the trend towards electric vehicles; this shift was emphasized by its May 26 investor meeting, where it outlined the Ford+ plan.

Ford+ includes a goal for 40% of the automaker's global vehicle volume to be electric by 2030, including the Mustang Mach-E, which is already on the market, and the F-150 Lightning pickup, which will go on sale next year. E-transit commercial vans will debut later in 2021. Ford also raised its total spending on electrification to more than $30 billion by 2025. This inclu! des inves! tments in battery technology, development and production.


The automaker also plans to enhance its digital services through one million connected Ford vehicles that will be on the road by the end of 2021. It is integrating its vehicles with digital technologies from Apple (AAPL), Amazon.com (AMZN),Alphabet (GOOGL)and Baidu (BIDU). It also unveiled Ford Pro, an initiative that focuses on serving business clients.

Argus Research analyst Bill Selesky recently reiterated his Buy rating on the green energy stock after the company swung to an adjusted net profit of $511 million (13 cents per share) in the second quarter compared with an adjusted net loss of $1.4 billion (35 cents per share) in the same quarter a year ago.


“The swing to a better-than-expected operating profit in 2Q21 largely reflected strong revenue growth in North America, South America and Europe, which partly offset ongoing semiconductor supply shortages,” Selesky says.

The analyst notes that Ford has strengthened its balance sheet and set clear financial targets, and that it is enjoying strong consumer interest in its vehicle lineup, including new EVs.

Even with headwinds from the chip shortage, business should strengthen overall due to expectations for increased consumer spending helped by stimulus payments and the vaccine rollout, low borrowing costs and record savings rates, Selesky points out in a recent note.


“We view Ford shares as attractively valued at current levels based on our expectations for increased consumer spending and accelerating vehicle sales in 2021,” he concludes.

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Canadian Solar”row


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Market value: $2.2billion2020 revenue: $3.5 billionCurrent ratio: 1.1

With global emphasis on renewable energy on the rise, the future is looking sunny for Canadian Solar (CSIQ, $36.33). The company is one of the world's largest manufacturers of solar panels, inverters and related equipment.It also manages s! olar plan! ts globally and provides battery storage solutions.

In the company'sfiscal second quarter, Canadian Solar reiterated its guidance for 2021 revenues, which it expects will be in a range of $5.6 billion to $6.0 billion a 70% year-over-year jump at the midpoint.

But a little caution might be advised in the near-term.

Following the company's most recent earnings report, in which Canadian Solar crushed earnings expectations, CFRA analylst Stewart Glickman (Hold) lifted his 2021 profitestimatesby 74 cents per share to $1.34 per share.

“CSIQseems intent on protecting margins, and Q3 margin guidance is improved as well,” he says.

Despite calling efforts to protect margins “laudable,” however, Glickman warns that “we hear mixed messages when management also announces that it expects to continue growing market share (which is possible, but unlikely in our view, if setting a floor on pricing is turning away or deferring customers to future periods).” He also lowered 2022 profit estimates by 21 cents per share to $2.64.

Nonetheless, a Buyconsensus rating signals that the broader analyst community still considers CSIQ among the energy stocks that investors should have on their radar.

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