Recent months have shown the Biden Administration’s strong commitment to the ‘Green Economy,’ particularly in the clean energy sector. The administration has taken significant steps, such as signing the Inflation Reduction Act last August and launching multi-billion-dollar funding initiatives, to promote and support clean energy adoption. Key efforts include boosting electric vehicles, pushing for solar and wind-powered energy production, and implementing tax and regulatory incentives to transition from fossil fuels to greener alternatives.

One area that has greatly benefited from these developments is the solar energy sector. As the demand for renewable energy continues to surge, solar energy companies are experiencing increased investment and growth. Recognizing the potential of this sector, Goldman Sachs has identified two solar power stocks that are well-positioned to capitalize on the Biden Administration’s policies.

SolarEdge Technologies (SEDG)

SolarEdge Technologies is a leading company in the microinverter niche market, a crucial component of photovoltaic power generation installations. The company holds about 40% of the US microinverter market share. In addition to microinverters, SolarEdge is involved in various solar technology product lines, including monitoring systems, power optimizers, and solar-powered EV charging stations for residential use.

Recent product announcements, such as a new bi-directional, DC-coupled EV charger that draws power directly from solar panels, have garnered positive attention. SolarEdge’s Q1 2023 earnings beat expectations, indicating a strong performance and continued growth potential. Goldman Sachs analyst Brian Lee believes the company will continue to surpass earnings forecasts, possibly leading to a positive surprise for investors.

Goldman Sachs gives SolarEdge a “Buy” rating, with a target price of $414, representing a potential one-year upside of 51%.

First Solar (FSLR)

First Solar, a well-established solar power manufacturing firm, has been in the industry since 1999 and is now the largest US-based producer of photovoltaic panels. The company is on track to deploy 21 gigawatts of solar power generation by 2026 and has invested significantly in research and development.

First Solar’s flagship product, the Series 6 and Series 6 Plus photovoltaic panels, are renowned for their reliability and environmentally friendly performance. The company also offers a 30-year performance warranty for added assurance.

While the company fell short of revenue expectations in the last reported quarter (1Q23), there are positive developments on the horizon that could potentially boost the stock in the coming months. Goldman Sachs’ Brian Lee remains bullish on First Solar, citing potential catalysts like discussions around manufacturing capacity expansion and increased bookings activity in the US utility-scale sector.

Goldman Sachs maintains a “Buy” rating for First Solar, setting a price target of $272, implying a one-year potential gain of 37%.

Source: finance.yahoo.com

Important Disclaimer
The information provided is intended for informational purposes only and should not be considered as investment advice or recommendations. It is crucial for readers to conduct their own analysis and research before making any investment decisions. The mentioned stocks may carry inherent risks, and past performance does not guarantee future results. Always consult with a financial advisor or professional before investing in any financial instruments. This article does not constitute a recommendation or advice for any specific investment strategy or security.