Renewable energy stocks are becoming a strong sector. Stocks like ChargePoint and Tesla are stocks to watch. Let’s be real. Gas and coal can’t be our main sources of energy forever. The facts are hard to ignore despite the ongoing debate about climate change and the Earth slowly heating up. Many alternative sources of energy are present all around us. They can be as efficient as coal and gas, with a lesser negative impact on the world.
|CHPT||ChargePoint Holdings Inc|
|LIT||Global X Lithium & Battery Tech ETF|
|RIO||Rio Tinto Group|
|LEU||Centrus Energy Corp|
|WSTRF||Western Uranium & Vanadium Corp|
|FCUUF||Fission Uranium Corp|
|ICLN||iShares Global Clean Energy ETF|
|TAN||Invesco Solar ETF|
|QCLN||First Trust NASDAQ Clean Edge Green Energy Index Fund|
Are Renewable Energy Stocks a Good Investment?
Many public companies are developing new technologies to bring these resources to the public.
Some are still in the early phases of development, while others are finally seeing some exciting growth.
Today, we will explore various alternative energy sources and companies worth investing in those fields. We previously wrote about hydrogen fuel stocks. Now, we will focus on electric and nuclear stocks.
These are becoming good investments. So you’ll want to make a watchlist of the stocks we’ll list below. The first renewable energy stocks on our list have been around for decades. Electricity is part of our daily lives. One of the main positive aspects of electricity is its ease of production. We won’t get into the theory, but here are a few examples.
One of the main ways in Canada is hydroelectricity due to the ease of access to water. However, solar panels and wind turbines are also common worldwide. The wind is omnipresent around us and is a cheap and efficient way to produce and store electricity.
Finally, there isn’t a shortage of sun around us. Many countries and companies are harvesting their power. Let’s look at a few companies investing and innovating with electricity.
It’s no secret that electric car sales are growing very quickly.
For anyone walking around big cities in the US, Canada, or Europe, it’s inevitable to stumble upon an electric car.
However, it’s rare to find a profitable electric car producer. Some don’t even have any revenue yet.
Many are public, but how many will be able to compete? And why would we include them in a renewable energy stocks list?
Tesla (NASDAQ: TSLA): Tesla has been profitable for a few quarters now, thanks to its first-mover advantage. Revenue and sales are also experiencing strong growth. We can easily compare Tesla to Apple. Many want to have one because of bragging rights and prestige. It might not be the best, but showing off is helpful.
Lucid Group (NASDAQ: LCID): Lucid finally began producing and delivering Lucid Air, it’s luxury electric sedan. In Q4 of 2021, Lucid delivered only 125 cars. Revenue was only $26.4M. That’s less than 1% of Tesla’s numbers. They are ramping production, and future models will be due in the next few years. A sports car and an SUV are in the works. It’s too early to say if they will be competitive or profitable.
Rivian Automotive (NASDAQ: RIVN): Here is a fun fact before anything. Amazon has an 18% stake in Rivian. Why? Rivian is producing electric pickups and intends to deliver Amazon’s next set of delivery vehicles. Rivian has produced and delivered a few thousand vehicles. That’s already better than Lucid but far from Tesla. A Rivian SUV is also due later this year.
GM (NYSE: GM): Finally, we all know one. GM is the maker of the Chevy Bolt, which is having a lot of success. The company is promising 30 electric vehicles by 2025.
I am looking forward to this transition, especially for their pickup trucks. They will succeed in North America in the next few years.
Renewable Energy Stocks with Battery Producers
Batteries and charge points are necessary to make and charge the above electric vehicles.
Many companies are in this business. They are competing to make cheaper and longer-lasting batteries.
Which renewable energy stocks are worth a look at?
ChargePoint Holdings Inc (NYSE: CHPT): ChargePoint is an American company with the largest network of independent EV charging stations. The company operates in 14 countries with over 18,000 charging locations. How expensive is it to charge an electric vehicle? That is much more than the cost of producing that electricity. Charging stations can charge more than $10 per hour. As the number of electric cars increases, so will stations.
Wallbox NV (NYSE: WBX): Next on the list is Wallbox. The company designs manufactures and distributes EV technologies. They are behind some of the batteries and charging stations for electric vehicles. Performance is a key metric in this field. Users and companies want cheaper and quicker charging. L
Global X Lithium & Battery Tech ETF (NYSEARCA: LIT): Lithium is necessary for any EV infrastructure. This ETF holds various lithium stocks. Major lithium stocks and ETFs will benefit as production ramp up QoQ.
We continue our renewable stocks list with nuclear energy. It is an alternative way to produce power. It is a generally safe way, and accidents are on the decline.
Nuclear energy is produced by splitting or fusing atoms such as uranium, vanadium, and plutonium with heat—enough about science; back to stocks.
Many countries are experiencing oil and gas shortages with the war in Ukraine. As a result, they are turning to new alternative energy sources.
Before processing these resources, it is necessary to mine them. Many companies own large deposits domestically and internationally. Kazakhstan is the largest uranium producer.
Rio Tinto Group (NYSE: RIO): Rio Tinto is the world’s second-largest metal miner and producer. It produces significant quantities of uranium, among other metals. However, it isn’t in the top 5 for uranium. So I don’t see why the company wouldn’t expand its operations to meet the increasing demand for the resources needed for nuclear power.
Cameco Corp (NYSE: CCJ): Cameco is the second-largest global uranium producer (18%) and the first in terms of public companies. It is based in Canada and has mines in North America and Kazakhstan. In addition, Cameco owns the world’s highest-grade uranium mine in Canada. It is worth a look.
Other small companies: Many small-cap stocks have plenty of potential in this mining sector. Centrus Energy Corp (NYSE: LEU) provides nuclear fuel to power plants. Western Uranium & Vanadium Corp (OCT: WSTRF) operates in Western Canada and Utah. It is ramping up its production. Last on the list is Fission Uranium Corp (OTC: FCUUF). It is an energy stock with uranium mines in the Athabasca Basin in Canada. It is a cheap stock with plenty of upsides.
I wouldn’t be surprised to see many mergers and acquisitions in the nuclear sector. Production will ramp up in the upcoming years as more countries seek cleaner energy.
Green Energy ETFs
Many ETFs are engaged in renewable energy stocks. Below are a few examples.
iShares Global Clean Energy ETF (NASDAQ: ICLN): BlackRock’s ETF leads the way with the most Assets Under Management (AUM). It is heavily oriented towards solar and electric energy. There is also a significant percentage of its holdings in semiconductors. Less than 5% of its holdings are in oil and gas companies. For ESG proponents, this ETF follows its guidelines in the letter.
Invesco Solar ETF (NYSEARCA: TAN): Invesco’s ETF is similar to BlackRock’s. The top holdings are very similar, along with their allocations. Both ETFs have suffered significant losses since their inception in 2008. Since 2020, there has been a rebound with Biden’s promotion of renewable energy. A stronger recovery is unavoidable for companies put a stronger emphasis on cleaner energy sources.
First Trust NASDAQ Clean Edge Green Energy Index Fund (NASDAQ: QCLN): We conclude this section with an ETF performing very well since its inception. The fund allocation differs from its competitors. There is a higher allocation to electric automobile stocks and the necessary materials for their functioning. It is well-diversified and worth a look.
How to Invest in Renewable Energy Stocks Conclusion
To conclude, there exist many ways to invest in renewable energy stocks. Above, we mentioned two, namely electricity and nuclear. In addition, many countries worldwide depend on coal and gas as a main source of revenue.
It won’t be easy to phase out completely these resources. However, it is important to diversify to replace them without downgrading our quality of life, just like investments, energy production, and consumption in every country.
Plenty of new and existing companies are developing new methods and are using new materials to fill these needs. There will hopefully be many new technological advancements in the years to come. New companies will rise to the challenge. The energy sector can be very beneficial for investors in the long term.