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Solar Stocks Are Good Investments For Years To Come


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Solar StocksWhile solar stocks are not a new sector, they are good investments with many high growth years ahead.  Solar stocks are likely to be one of the best performing sectors for years to come, as the solar build-out is just getting started, and is expected to grow by an average of 20% per year for the foreseeable future.  Investors should not let this opportunity to profit from the pending solar boom pass them buy.  Now is the time to research solar stocks and solar oriented Exchange Traded Funds (ETFs) to make investments in the solar industry.

Why Solar Stocks Are Good Investments For Years To Come

The cost of delivering solar power has dropped so much in recent years that solar power is expected to be cheaper than traditional grid delivered power in all major metropolitan areas in the United States by 2027.  In just the past seven years, a solar power installation for a home or business has gone from an average cost of $8 per watt to $4 per watt, a 50% decrease.  At the same time, the cost of grid based electric power that utilities deliver to customers has increased slowly. Solar Grwoth Rate These positive trends for solar are expected to continue until 2027, when all major metropolitan areas in the United States are expected to have solar power that is cheaper than grid electricity.  This will lead to an explosion of solar installations over the next decade or two, as home and business owners rush to install solar power systems on their buildings to save money on their electric bills.  The growth potential for solar stocks in this business environment is tremendous, which make solar stocks a good investment for years to come. Another important development that will drive large increases in the installation of solar power systems in coming years is the availability of solar financing options that have become available to meet market demand for solar power.  The financing options will fuel the coming explosion in solar power installations, as homes and business owners no longer have to pay the large cost for a solar power system up front, but can instead finance a solar power system by essentially renting their roof to solar companies and then paying them on a monthly basis for the solar electricity produced on their roofs at a rate that is less than the cost of grid based electric power.

Solar Stocks and Funds To Invest In The Ramp Up of Solar Power Installations

SunEdison Solar Stock There are a wide variety of solar stocks that investors can be purchase to participate in the expected high rate of growth in solar industry over the next two decades.  There are also solar ETFs that invest in companies that derive some or all of their revenues from businesses related to solar power.  Solar ETFs are a safer way to invest in the solar power sector, since ETFs spread the investment risk out among many companies.

The following is a look at some of the solar stocks and ETFs available to invest in for the anticipated ramp up in solar power installations.  Keep in mind that even in a hot and growing sector such as solar energy, there will be winners and losers over the long-run, so do your due diligence carefully regarding which solar stocks to invest in.  ETFs that invest in the solar sector provide a good way to expose your investment portfolio to the expected growth in the solar sector without betting on individual solar stocks.

  • SunEdison, Inc. (NYSE:  SUNE) provides solar energy services that integrate the design, installation, financing, monitoring, operations, and maintenance portions of the solar market.  The company also manufactures solar modules.
  • SunPower Corporation (NASDAQ:  SPWR) produces the most efficient solar panels commercially available (21.5 percent efficient), which has made demand for their products high.  SunPower Corporation designs, manufactures, and provides solar power systems to residential, commercial, and utility customers.  It also designs utility-scale photovoltaic power plants.  In addition, the company provides operations and maintenance services for solar power systems, from remote monitoring to preventative and corrective maintenance services, as well as emergency outage restoration and inverter repair services.  The company is also in the residential solar leasing business.
  • SolarCity Corporation (NASDAQ:  SCTY) is the leading solar company in leased solar power space.  This is one of the fastest growing solar markets, since it companies such as SolarCity assume the large installation cost for a solar power system, removing one of the stumbling blocks to adoption of solar power on a wide scale.  Businesses and homeowners that lease their rooftops to SolarCity, buy the solar electricity at rates that are cheaper than grid power.
  • First Solar, Inc. (NASDAQ:  FSLR) designs, manufactures, and sells solar modules that convert sunlight into electricity.  First Solar has long been a darling of Wall Street, since it has been a leader for years in the field of providing solar cells and has a history of making profits.
  • Canadian Solar (NASDAQ:  CSIQ) is one of the top five solar cell suppliers in the world.  Canadian Solar recently returned to profitability and has a forward Price to Earnings ratio (P/E ratio) of just 8.5.
  • Jinkosolar Holdings Co. (NYSE:  JKS) designs, develops, produces, and markets photovoltaic products in China and to a lesser degree internationally.  Jinkosolar has an incredibly low projected 2015 P/E ratio of approximately 6, which makes it highly undervalued at current prices.
  • Trina Solar Limited (NYSE:  TSL) is an integrated solar-power products manufacturer and solar system developer that does business in many parts of the world.  With fiscal year 2015 earnings expected to be between $1.34 to $1.60, Trina Solar looks like a value play since its P/E ratio is approximately 8.
  • Guggenheim Solar ETF (NYSE:  TAN) is a solar ETF that tracks the performance of the MAC Global Solar Energy Index.  The index contains approximately 26 securities of companies that do business in the solar power sector.
  • Market Vectors Solar Energy ETF (NYSE:  KWT) tracks the Market Vectors Global Solar Energy Index.  The index contains equity securities of companies that generate at least 50% of their revenues from solar power business operations, or the provision of solar power equipment/technologies and materials or services to solar power equipment/technologies producers.

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