Clean Energy Selloff: 3 Stocks to Own Ahead of November’s Surge

Energy stocks have long been the favorites of many investors. The energy sector includes various smaller industries and companies such as oil, natural gas, coal, alternative energy, and many others. However, as our society becomes more aware of climate change and its devastating impact on the environment and wildlife, consumers and the government are increasingly pushing for the use of clean energy sources.

For this reason, renewable energy has been one of the fastest growing sectors in recent decades. Federal subsidies and incentives for renewable energy companies more than doubled from $7.4 billion in 2016 to $15.6 billion in 2022. With a global market size of $1.21 trillion in 2023, it is expected that the industry will grow at a compound annual growth rate (CAGR). at 17.2% in 2024–2030. Below are three clean energy stocks that investors should consider buying ahead of November’s rally.

Sun Run (RUN)

Sunny run (NASDAQ:START) is an American manufacturer of photovoltaic cells and systems based in San Francisco. The company specializes in battery energy storage products and is a pioneer in the growing photovoltaic industry.

One of the main challenges Sunrun faced from 2022 was macroeconomic conditions. Amid rising interest rates, the U.S. solar maker has struggled to finance large-scale solar projects, while high post-pandemic inflation rates initially challenged Sunrun with pricing pressure. While a big comeback may soon be unattainable as interest rates begin to fall to normal levels, Sunrun will be able to finance larger solar projects to help the company grow again.

While the renewable energy company is not yet profitable, the latest financial reports indicate that finances are improving. For the first quarter of 2024, analysts predicted earnings per share with a loss of 46 cents, but in reality, the company only reported a 40% EPS loss. While its financial performance is still far from perfect, improving financials and revenues point to a possible comeback.

Plug power supply (PLUG)

Connect the power (NASDAQ:PLUG) is a New York-based hydrogen fuel company specializing in developing hydrogen fuel cell solutions to replace conventional batteries powered by electricity. Although the share price has nearly halved since the beginning of the year, investors should be optimistic about Plug Power, especially given its long-term growth potential.

The hydrogen fuel giant recently received conditional loan guarantees worth $1.66 billion from the Department of Energy. According to the company and the government agency, the money will be used primarily for the construction of six green hydrogen pipelines. The newly constructed pipelines will supply numerous large corporations, the majority of Plug Power’s customers, with environmentally friendly hydrogen energy. This conditional loan guarantee partnership with a government agency will drive greater decarbonization in the U.S. and help Plug Power increase its competitiveness in the emerging market.

Linde (LIN)

Linde (NASDAQ:LIN) is the world’s largest industrial gassing company. The Ireland-based industrial gas giant is aggressively expanding into the hydrogen sector in an attempt to capitalize on the growing renewable energy sector.

Linde’s strength comes from its diversified business model. Unlike most energy companies, instead of relying on one energy source and taking huge risks, Linde invests in multiple energy sources to have a stable and consistent source of income.

Moreover, analysts seem bullish on Linde stock. Nine out of 14 analysts have a buy rating on Linde, while none of the analysts gave the company a sell rating. The average price target indicates over 10% upside potential for the stock. As the hydrogen energy sector continues to develop, Linde will seize the growth opportunity.

As of the date of publication, Andy Kim did not hold (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com Publishing guidelines.