Wednesday Feb 08, 2023

10 Best Green Energy Stocks for 2022 – Kiplinger’s Personal Finance

President Joe Biden’s Build Back Better Act – which allocated hundreds of billions of dollars to clean energy investments and tax incentives – has yet to make it out of the Senate and its prospects look bleak. Still, the future for green energy stocks is looking bright.

For starters, an executive order signed by Biden in early December is designed to boost America’s clean energy economy through sustainability efforts at the federal level. Among the initiatives outlined in the order is a pledge by the White House to ensure the U.S. government will have “net-zero emissions from overall federal operations by 2050.”

Obviously, that’s a lofty goal for any organization, much less one as large as the U.S. government. But we’re not the only country going green.

“Renewables are set to account for almost 95% of the increase in global power capacity through 2026,” according to a report from the International Energy Association (IEA). “The amount of renewable capacity added over the period of 2021 to 2026 is expected to be 50% higher than from 2015 to 2020.” China and India are leading the clean energy charge, but America and Europe are “on track to speed up significantly from the previous five years,” the report says.

And in its 2022 Renewable Energy Outlook, Deloitte says, “Renewable energy growth is poised to accelerate in 2022, as concern for climate change and support for environmental, sustainability and governance considerations grow and demand for cleaner energy sources from most market segments accelerates.”

Suffice it to say, green energy is one sector where many investors could be looking for significant growth in 2022 and beyond. 

With that in mind, here are 10 of the best green stocks for investors looking to profit on the growing trend toward sustainability. Included in the list are names from a variety of sectors and industries and all are well-liked by the analyst community.

 Share prices and other market data as of Feb. 16. Average price targets and analyst ratings provided by market data tool Koyfin.

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  • Sector: Materials
  • Industry: Chemicals
  • Market value: $28.8 billion
  • Consensus analyst rating: Buy (23 analysts)

Worldwide electric vehicle (EV) sales are “now up over 100% year-on-year versus the last year,” said Eric Norris, Albemarle’s (ALB, $246.00) lithium division president, at Deutsche Bank’s 6th Annual Lithium and Battery Supply Chain Conference. And “in countries like China, it’s 200%.” 

Obviously, for a company that earns over $1.1 billion from lithium sales alone, that bodes well for ALB’s prospects. Especially when you consider today’s $208.9-billion EV market is expected to reach more than $957.4 billion by 2030, according to global research firm Market Research Future. That adds up to a compound annual growth rate (CAGR) of 24.5%.

And that’s why in a recent analyst report, Argus Research’s Bill Selesky (Buy) says his organization looks for Albemarle to be “a major beneficiary” of lithium market growth, which he projects to be around 30% CAGR between 2021 and 2025.

In fact, in the company’s Nov. 4 earnings call, CEO Kent Masters says the company already saw “net sales of $831 million and adjusted EBITDA [earnings before interest, taxes, depreciation and amortization] of $218 million” in its third quarter. Although EBITDA remained relatively flat on a year-over-year basis, that’s an 11% improvement in sales. 

And ALB reported higher-than-expected revenue and earnings in its fourth quarter. While the stock …….


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