Making money and saving the planet doesn’t have to be mutually exclusive. In fact, there are plenty of publicly-traded companies that are finding ways to capitalize on new, environmentally-friendly technology. Among the best stocks an investor can pick—both for their portfolio and for the sake of the planet—are alternative energy stocks.
Alternative energy is generated in ways that don’t hurt the environment. No fossil fuels are burned, no harmful chemicals are released, no oceans, ice caps, or forests are laid to waste. The most common forms of alternative energy—often called “renewable” or “sustainable energy”—are wind, solar, biomass, geothermal, hydro, and biofuels.
One of the biggest reasons that investors should feel optimistic about investing in alternative energy stocks is that governments, corporations, and the public are increasingly demanding sustainable energy options over fossil fuel-based energy. Last year, 17.6 percent of all energy in the United States was generated via renewable resources. That’s double what it was a decade ago.
Not only have regions like British Columbia, California, and Hawaii committed to relying 100 percent on alternative energy over the next few decades, major corporations like Goldman Sachs (NYSE:GS) have been seriously warming up to companies in the wind and solar sectors. Some analysts believe that, between 2018 and 2030, cumulative private investments in renewable energy in the US could reach as high a $1 trillion.
As news of extreme weather events continues to beat down on us like so much torrential rain, let’s take a look two of the best small-to-mid-sized alternative energy stocks that are both turning a profit and making the world a little more sustainable.
Pattern Energy Group
The San Francisco-based Pattern Energy Group Inc. (TSX:PEGI) (NASDAQ:PEGI) currently owns 24 wind power facilities throughout Canada, the United States, Mexico, and Japan. As you read this, it is at work developing eight more. The company’s total operating capacity is currently around four gigawatts. That’s the equivalent of approximately 12.5 million solar panels.
Since the start of the year, PEGI stock has risen 44 percent, and the company currently expects to produce approximately $175 million in cash flow by the end of the year. Earlier this week, Pattern Energy announced that it began operations at its 220 megawatt Grady Wind facility in Curry County, New Mexico.
This company is clearly on the rise, and if it can achieve its ambitious growth plan for the year, it might just cement itself as a giant among alternative energy stocks in the near future.
Canadian sustainable energy company Northland Power Inc. (TSX:NPI) (OTCPK:NPIFF) has an impressively diversified portfolio. Not only does it own and operate natural gas, wind, solar, and hydro power facilities across Ontario and Quebec, it has a number of projects in various stages of development in Europe and Asia as well.
Analysts have given Northland a return on equity score of 30 percent, meaning that for every $1.00 of equity the company possesses, it can make $0.30. This score is based on the company’s performance in the previous year. According to its Q2 2019 financial report, Northland is steadily increasing its cash flow, gross proceeds, and net income year-over-year.
Because this company has invested in such a broad range of alternative energy sources, it is uniquely positioned to capitalize on attitudes towards progressive energy.
The Future of Alternative Energy Stocks
Pattern and Northland are just two alternative energy stocks carving a place for themselves in the alternative energy industry. There are dozens more across North America and elsewhere, and all signs indicate that the alternative energy sector will continue to grow as reliance on fossil fuels dwindles.
Investors should watch as technological advancements and investments in developing nations determine sustainable energy trends in the coming years. Not only will these make the future a little bit brighter for the next generation, but they will also prove to be quite lucrative.
Featured image: DepositPhotos © taraki