Most recently, SunPower missed analysts’ consensus forecasts for its Q1 earnings. Right now, SPWR stock is trading at a P/E ratio of 98, which is high but not nearly as high as the other two stocks on this list.
Also attractive is SunPower’s valuation, which is much lower than both First Solar and Sunrun. Throughout the past five years, the share price has increased 150%. However, long-term, the stock’s track record is better. This solar stock has had a bumpy ride throughout the last 12 months with its share price dropping 32%. The company used to service commercial clients before moving to concentrate solely on residential homes. Founded in 1985 by a former electrical engineering professor at Stanford University, SunPower is a long-time leader in the evolution of solar power technology. However, SunPower differs in that it is an older, more mature company. It makes the batteries and energy storage technology that power solar panels. SunPower (NASDAQ: SPWR) is a solar company with a near identical business model to that of Sunrun. This has maintained an “overweight” (buy) rating on RUN stock and lifting its price target to $39 from $30, implying 85% upside. The stock has been trending higher lately after the company beat consensus analyst expectations with its latest earnings, and after Morgan Stanley (NYSE: MS) raised its price target on the stock. Right now, Sunrun’s share price is trading at a price-earnings (P/E) ratio of 357, making them look expensive. While RUN stock is trading nearly 50% higher than where it was five years ago, this solar stock has a share price that is down 9% throughout the last 12 months.Įven with that drop, RUN stock is still trading at a hefty valuation, though not as steep as FSLR stock. Founded in 2007, the company is still emerging, doing about $2 billion a year in sales. The company specializes in the batteries and energy storage systems that are essential to the solar panel systems used with residential homes. The share price is actually down from a peak reached in spring after the company missed on its first-quarter results, reporting earnings of 40 cents a share versus the expected 99 cents.įor more of a buy-the-dip opportunity, look to Sunrun (NASDAQ: RUN). However, right now, new investors will pay a steep premium for FSLR stock. Clearly, investors are betting that First Solar’s business will continue to grow quickly as the transition to renewable energy sources gathers steam across the United States. If there’s a red flag with FSLR stock, it is the valuation.Ĭurrently, the shares are trading at more than 500 times future earnings. The company’s solar stock has gained 35% this year, is up 167% throughout the last 12 months and has increased 283% through five years. Among solar energy companies, First Solar is a standout.
It also provides financing services to its residential and commercial clients. If you can only buy one solar stock, it better be one of these three names.Ĭonsider a Solar Stock: First Solar (FSLR)įirst Solar (NASDAQ: FSLR) is a manufacturer of solar panels that covers the entire life cycle of the product, from initial build and maintenance through to end-of-life recycling. That growth should help to drive solar stocks higher throughout the next decade, making now a great time for investors to take a position. Allied Market Research estimates that the global solar energy market will grow to $300 billion by 2032 from $94.6 billion in 2022. The solar market is booming as adoption of renewable energy heats up with both commercial and residential customers.
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