Top Solar Stocks for Q2 2020

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The solar energy industry has been growing rapidly even as fossil fuels remain the dominant form of energy. Solar industry companies come from multiple sectors, including utilities, industrial, and energy, and include popular stocks such as First Solar, Inc. (FSLR) and SunPower Corp. (SPWR). While some large utilities and energy companies have solar and renewable energy divisions, they typically are not included in the industry’s listings because their primary focus is not solar. In the 12-month trailing period, the solar industry has outperformed the S&P 500. The Invesco Solar ETF (TAN) saw a total return of -4.7% compared to a total return of -13.7% for the S&P. All figures are as of March 18, 2020.

Here are the top solar stocks with the best value, the fastest earnings growth, and the most momentum.

Best Value Solar Stocks

These are the solar sector stocks with the lowest 12-month trailing price-to-sales (P/S) ratio. A low P/S ratio suggests that a stock is undervalued, as investors are willing to pay less per dollar of sales.

Best Value Solar Stocks
  Price ($) Market Cap ($B) 12-Month Trailing P/S Ratio
JinkoSolar Holding Co. Ltd. (JKS) 13.55 0.6 0.1
Canadian Solar Inc. (CSIQ) 14.80 0.9 0.3
SunPower Corp. (SPWR) 5.36 0.9 0.4
  • JinkoSolar Holding Co. Ltd.: JinkoSolar is a Chinese holding company that produces solar cells, modules and other materials related to solar energy. In March, the company announced total solar module shipments for FY 2019 of 14.3 GW, within JinkoSolar’s guidance and up 25.6% year-over-year (YOY).
  • Canadian Solar Inc.: the Canada-based solar module product developer designs, builds, and sells modules with residential, commercial, and industrial applications.
  • SunPower Corp.: SunPower designs and builds silicon photovoltaic cells and related solar materials. SunPower recently announced an expansion into New England, where it is slated to deliver approximately 11 MW of direct current solar power.

Fastest Growing Solar Stocks

These are the solar sector stocks with the highest YOY quarterly revenue growth for the most recent quarter. Rising revenues show that a company’s business is growing and is generating more money that it can reinvest or return to shareholders.

Fastest Growing Solar Stocks
  Price ($) Market Cap ($B) YoY Revenue (Quarterly) Growth (%)
Hannon Armstrong Sustainable Infrastructure Capital (HASI) 19.65 1.3 198.8
Enphase Energy Inc. (ENPH) 29.28 3.6 127.6
First Solar Inc. (FSLR) 32.26 3.4 102.4
  • Hannon Armstrong Sustainable Infrastructure Capital: Unique among many of the companies on this list, Hannon Armstrong Sustainable Infrastructure provides debt and equity financing to renewable energy and energy efficiency companies. The company recently announced an investment of $115 million in a sustainable energy utility project centered at the University of Iowa.
  • Enphase Energy Inc.: Enphase Energy manufactures solar power materials with a focus on increasing reliability and productivity of solar modules. In March, the company announced that its solar storage installation systems had been shipped to 18,000 homes worldwide.
  • First Solar Inc.: First Solar designs and builds solar modules using a thin film semiconductor technology.

Solar Stocks With the Most Momentum

These are the solar sector stocks that had the highest total return over the last 12 months.

Solar Stocks With the Most Momentum
  Price ($) Market Capt ($B) 12-Month Trailing Total Returns (%)
Enphase Energy (ENPH) 29.28 3.6 223.5
SolarEdge Technologies Inc. (SEDG) 84.71 4.2 112.1
Daqo New Energy Corp. (DQ) 55.35 0.7 68.3
Invesco Solar ETF (TAN) N/A N/A -4.7
S&P 500 (SPY) N/A N/A -13.7
  • Enphase Energy Inc.: See above for company description.
  • SolarEdge Technologies Inc.: SolarEdge Technologies builds and distributes equipment and technology for photovoltaic arrays. The Israeli company launched in 2006 and did an IPO in 2015. It recently announced FY 2019 revenue of $1.4 billion, up more than 50% YOY.
  • Daqo New Energy Corp.: Chinese solar energy company Daqo New Energy manufactures polysilicon for distribution to manufacturers of solar technology products.

Source: Investopedia

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