3 Renewable Energy Stocks That Don’t Care About the Electoral College

The election continues to be a hot topic for viewers and investors. And the Electoral College may be more newsworthy than it has been for a long time when it meets in January. But there are renewable energy stocks that don’t care what happens politically.

Three Motley Fool contributors have found renewable energy stocks that are expected to succeed in 2021. And the leaders are JinkoSolar Holding (NYSE: JKS), Brookfield Renewable partners (NYSE: BEP), and Bloom Energy (NYSE: BE).

The leader in manufacturing

Travis Hoium (JinkoSolar): One of the most unknown solar energy stocks today is JinkoSolar. The company might not be a household name, but it is one of the largest and most advanced solar manufacturers in the world. And with a manufacturing base in Asia and customers all over the world, JinkoSolar doesn’t care who will be in the White House in 2021 as long as the solar industry continues to grow.

You can see from the graph below that even the past four years have been good for JinkoSolar. Turnover has almost doubled, margins have improved since mid-2017 and the company is solidly profitable. US tariffs that were a hiccup in 2017 are now well in the rearview mirror.

JKS Revenue Data (TTM) by YCharts

The solar manufacturing industry has seen a number of ups and downs over the past two decades, but we are now reaching the point where scale and cost are the differentiators that will keep the competition at bay. As one of the largest manufacturers in the world, JinkoSolar is built to be successful and with a market cap of just $ 2.9 billion, a P / E ratio of 22, it’s also good value for investors.

On track for double-digit returns

Howard Smith (Brookfield Renewable Partners): The trend towards more renewable energy production will continue regardless of the election results, and Brookfield Renewable Partners has just reaffirmed that it will continue to play an important role, with plans to give shareholders and unitholders above-average returns.

Brookfield Renewable operates or develops 38,000 megawatts of renewable energy assets globally. Its most significant recent investment has entered Terraform Power’s North American and European solar and wind portfolio of assets after a fully equity acquisition. Brookfield says the transaction will pay off immediately.

In the recently reported third quarter, the company said its funds from operations (FFO) per unit – a more appropriate measure of operating performance than net income – increased 12% from the period of the last year.

Brookfield also has an excellent balance sheet, with $ 3.3 billion in cash and no significant debt maturing in the next five years. This is an advantage that is used with the size of the business. For example, the company recently concluded a major solar development project in Brazil. The project has 75% of its production under contract under long-term agreements. Brookfield said it was able to leverage its local expertise to contract the rest and that it would be able to reduce equipment and operating costs by using its global scale.

In addition to its strong balance sheet, Brookfield takes an approach of acquiring assets, increasing their value through its expertise and operational initiatives, and recycling them to generate income for exciting new investments.

Investors can expect this approach to continue to provide above-average returns. Management said they plan to continue growing the business and said they still expect to “meet our goal of long-term returns of 12-15% to shareholders.” The election results were not going to change that plan one way or another.

Bigger than any country

Jason hall (Bloom Energy): Bloom Energy is in the midst of a major transformation that could prove crucial to the future of renewable energy. For years, proponents of hydrogen have praised its potential, while the economic realities of hydrogen production have kept it from gaining any sort of mass adoption.

However, the combination of the falling cost of producing renewable electricity from wind and solar power, coupled with Bloom’s solid oxide fuel cells to electrolyze hydrogen from water, is expected to displace the hydrogen of the few niches that it resolves towards the general public. The bottom line is that there is immense potential for using hydrogen produced by renewable energies to store energy. Hydrogen has enormous energy density, making it an ideal fuel for heavy transport on land and sea, as well as a great way to store excess energy from renewables that can be used when the wind is not blowing or the sun is not shining. The company has signed very large contracts over the past year to further develop its technology for large-scale applications, including fuel cells to power container ships, and to serve the electricity industry. on a large scale to produce hydrogen and convert that hydrogen into electricity.

And while there is still some way to go for these development deals to materialize, the economics improve a bit with each new generation of solar panels and wind turbines, reducing the cost of producing the plant. electricity to power the electrolyser. The global focus on climate change and energy security is providing huge favorable winds for Bloom. With stocks down nearly 28% in the past month, investors poised to weather great volatility in the next few years might consider making a risk-reward investment in Bloom’s outlook to finally solve the puzzle. hydrogen for good.

Renewable energies are on the rise

You will notice that the theme here is that favorable winds are firmly behind renewable energy stocks and with global opportunities, a country’s policy is not going to change momentum. JinkoSolar, Brookfield Renewable Energy and Bloom Energy have a bright future, whatever the political landscape.