The world is fighting to go green. So, it’s a good idea to have exposure to some of the best renewable energy stocks to buy in April.
For one, according to the International Energy Agency, renewable energy sources will account for over 42% of global electricity generation, with wind and solar doubling to 25%. In addition, the agency says the “World added 50% more renewable capacity in 2023 than in 2022 and next 5 years will see the fastest growth yet…”
Two, when and if the Federal Reserve does cut interest rates, renewable energy projects could see further upside. Remember, when interest rates get too high, financing gets more expensive and margins suffer.
Three, for the world to meet the net-zero scenario, BloombergNEF says energy investments would have to average about $4.7 trillion a year between now and 2030.
Helping, 116 countries recently signed the Global Renewables and Energy Efficiency Pledge. That pledge aims to “triple global renewable generation capacity to at least 11,000 gigawatts and to double the global average annual rate of energy efficiency improvements from around 2% to more than 4% every year until 2030,” as noted by Edie.net.
That being said, I’d start buying the best renewable energy stocks to buy in April.
NexGen Energy (NXE)
With uranium prices still red-hot on supply-demand issues, consider NexGen Energy (NYSE:NXE) once it bottoms out again. After becoming overbought at $8.75, it’s now back to $8.33, and could potentially retest support at its 50-day moving average.
Over the long-term, uranium demand is expected to jump 127% by 2030. By 2040, demand could be up by 200%, creating a potential 240-million-pound deficit. Worse, the deficit could continue to widen with growth in annual demand expected to triple by 2050, as noted by the company.
Plus, over the last few weeks, NXE just announced a new uranium discovery at its SW2 Property. According to company CEO Leigh Curyer, “This new intercept reflects the high potential of NexGen’s extensive land package in the southwestern section of the Athabasca Basin, Saskatchewan. Drilling activity is being fully dedicated to this new discovery area to advance our understanding of scope and scale of mineralization.”
Again, wait for NXE to pull back before buying.
Brookfield Renewable Energy (BEP)
I’d also take advantage of the recent weakness in Brookfield Renewable Energy (NYSE:BEP). It’s another one of the best renewable energy stocks to buy in April.
For one, while we wait for it to recover, we can collect its current yield of 6.13%. It recently paid out a dividend of 35.5 cents per share, or about $1.42 annualized.
Two, its dividend is sustainable, with the company generating predictable cash flow. About 90% of its cash flowis contracted under long-term, inflation-adjusted deals.
Three, according to CEO Connor Teskey, “Going forward we are well positioned to continue benefiting from accelerating demand for clean power from corporate customers, and specifically the large global technology companies, whose increasing appetite for clean power is being driven by data center demand, with securing clean energy now squarely on their critical path to growth.”
Plus, earnings have been solid. In its most recent quarter, the company’s funds from operations came in at 38 cents, beating estimates by a penny. Revenue of $1.32 billion — up nearly 11% year over year — beat by $130 million.
Invesco Global Clean Energy ETF (PBD)
Or, if you prefer to diversify at a low cost of about $13.95, check out the Invesco Global Clean Energy ETF (NYSEARCA:PBD). With an expense ratio of 0.75%, the ETF invests in stocks that focus on renewable sources of energy and technologies that help facilitate cleaner energy.
Some of its top holdings include Sunrun (NASDAQ:RUN), Sunnova Energy (NYSE:NOVA), Enphase Energy (NASDAQ:ENPH), FuelCell Energy (NASDAQ:FCEL) and another 104 related holdings. What’s nice about this ETF is we can gain exposure to 108 green stocks at less than $14 a share at the moment.
Eventually, when the Federal Reserve starts cutting rates, I’d like to see the PBW ETF rally back to $31 initially. In the long term, I’d like to see the ETF run back to $65, which it hit in mid-2022. But again, much of this depends on when and if the Federal Reserve cuts interest rates.
On the date of publication, Ian Cooper did not hold (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
