We recently published a list of 10 Best Wind Power and Solar Stocks To Invest In Now. In this article, we are going to take a look at where Clearway Energy Inc. (NYSE:CWEN) stands against other best wind power and stocks to invest in now.
According to a report by the World Economic Forum published on November 8, the US election result is expected to have a significant impact on the transition to renewable energy sources. Solar and wind energy stocks fell sharply following the election, as Donald Trump's victory is anticipated to have a negative short-term impact on current climate policies. The president-elect has proposed policies that include increasing natural gas pipelines, ending offshore wind energy projects, and boosting fossil fuel production by easing restrictions on drilling on federal lands. He has also expressed intentions to withdraw the US from the Paris climate agreement and to support nuclear energy production.
Despite these challenges, analysts predict that the boom in renewable energy in the US is unlikely to be dramatically slowed. The Inflation Reduction Act passed during the outgoing administration, is expected to inject $1 trillion of spending into green energy, with estimates that 85% of the money has gone to districts that elected Republicans. This financial support, along with existing opposition to the curtailment of renewable energy, suggests that the long-term trajectory of the energy transition remains uncertain but potentially resilient.
In an interview with CNBC on November 13, Will Rhind, CEO of GraniteShares, discussed the potential implications of a Trump presidency on renewable energy such as wind and solar. Rhind noted that the playbook on energy policy was already seen in the previous Trump administration. The Trump administration has historically been more supportive of fossil fuels and less focused on renewable energy. Therefore, stocks and sectors favored by the Biden administration, such as solar and wind, might see a downturn.
Rhind suggested that the overall narrative may seem like it's shifting back toward traditional energy sources. However, Elon Musk seems to be playing an integral role in the Trump administration, and he has been a proponent of climate policies, with his electric vehicle (EV) industry and other businesses, which suggests that energy transition policies may not be as impactful as some might expect today.
While the outcome of the US election and the anticipated policies of the new administration pose short-term challenges to renewable energy, the long-term outlook remains cautiously optimistic.
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A wind farm in motion, its many turbines spinning in the breeze.
Our Methodology
To compile our list of the 10 best wind power and solar stocks to invest in now, we used clean energy ETFs plus online rankings to compile an initial list of 20 wind and solar energy stocks. We then used Insider Monkey’s Hedge Fund database to rank 10 stocks according to the largest number of hedge fund holders, as of Q3 2024. The list is sorted in ascending order of hedge fund sentiment.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Clearway Energy Inc. (NYSE:CWEN) is a leading renewable energy developer that's focused on utility-scale wind and solar power projects. The company operates a large portfolio of clean energy assets and supplies electricity to utilities and corporate clients.
Clearway Energy Inc. (NYSE:CWEN) has a strong emphasis on solar and wind power, with a focus on developing and acquiring new projects in these areas. On November 25, the company announced its agreement to acquire the Tuolumne wind project, a 137 MW facility in Washington state, from Turlock Irrigation District. The project will operate under a new 15-year power purchase agreement with Turlock Irrigation District, extending through 2040. As part of the deal, the company also secured an option for a potential future repowering of the project.
Clearway Energy Inc. (NYSE:CWEN) plans to invest $70 million to $75 million in total long-term corporate capital for the acquisition. Based on the anticipated financing terms, the project is expected to contribute approximately $9 million in annual levered asset CAFD (Cash Available for Distribution) on average over five years starting in 2026. In addition to this investment, Clearway Energy Inc. (NYSE:CWEN) is also exploring opportunities in battery storage and hybridization, which will enable it to optimize its renewable energy output and improve its competitiveness in the market.
Overall, CWEN ranks 9th on our list of best wind power and stocks to invest in now. While we acknowledge the potential of CWEN to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CWEN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
