As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the renewable energy industry, including Enphase (NASDAQ:ENPH) and its peers.
Renewable energy companies are buoyed by the secular trend of green energy that is upending traditional power generation. Those who innovate and evolve with this dynamic market can win share while those who continue to rely on legacy technologies can see diminishing demand, which includes headwinds from increasing regulation against “dirty” energy. Additionally, these companies are at the whim of economic cycles, as interest rates can impact the willingness to invest in renewable energy projects.
The 19 renewable energy stocks we track reported a slower Q3. As a group, revenues missed analysts’ consensus estimates by 7% while next quarter’s revenue guidance was 7.2% below.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Enphase (NASDAQ:ENPH)
The first company to successfully commercialize the solar micro-inverter, Enphase (NASDAQ:ENPH) manufactures software-driven home energy products.Enphase reported revenues of $380.9 million, down 30.9% year on year. This print fell short of analysts’ expectations by 3.3%. Overall, it was a softer quarter for the company with revenue guidance for next quarter missing analysts’ expectations.
Unsurprisingly, the stock is down 31.1% since reporting and currently trades at $63.60.
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Best Q3: American Superconductor (NASDAQ:AMSC)
Founded in 1987, American Superconductor (NASDAQ:AMSC) has shifted from superconductor research to developing power systems, adapting to changing energy grid needs and naval technology requirements.American Superconductor reported revenues of $54.47 million, up 60.2% year on year, outperforming analysts’ expectations by 6.1%. The business had an exceptional quarter with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
The market seems happy with the results as the stock is up 19.7% since reporting. It currently trades at $28.14.
Weakest Q3: Blink Charging (NASDAQ:BLNK)
One of the first EV charging companies to go public, Blink Charging (NASDAQ:BLNK) is a manufacturer, owner, operator, and provider of electric vehicle charging equipment and networked EV charging services.Blink Charging reported revenues of $25.19 million, down 41.9% year on year, falling short of analysts’ expectations by 28.1%. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations.
Blink Charging delivered the weakest full-year guidance update in the group. As expected, the stock is down 26.4% since the results and currently trades at $1.48.
Shoals (NASDAQ:SHLS)
Started in Huntsville, Alabama, Shoals (NASDAQ:SHLS) designs and manufactures products that make solar energy systems work more efficiently.Shoals reported revenues of $102.2 million, down 23.9% year on year. This print topped analysts’ expectations by 3.4%. Aside from that, it was a mixed quarter as it also recorded revenue guidance for next quarter exceeding analysts’ expectations but a significant miss of analysts’ EBITDA estimates.
The stock is down 22.2% since reporting and currently trades at $4.49.
Nextracker (NASDAQ:NXT)
With its technology playing a key role in the massive 1.2 gigawatt Noor Abu Dabhi solar farm project, Nextracker (NASDAQ:NXT) is a provider of solar tracker systems that help solar panels follow the sun.Nextracker reported revenues of $635.6 million, up 10.9% year on year. This result beat analysts’ expectations by 3.6%. It was a very strong quarter as it also logged an impressive beat of analysts’ backlog estimates and full-year EBITDA guidance exceeding analysts’ expectations.
The stock is up 38.1% since reporting and currently trades at $44.19.
Market Update
Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), and a notable surge followed Donald Trump's presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.Want to invest in winners with rock-solid fundamentals? Check out our and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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