Conventional wisdom dictates that low oil and gas prices indicate that there is minimal need for solar power initiatives. It is reasonable to think that energy consumers actually prefer cheaper fossil fuels. However, while fossil fuels still remain the most popular source of energy in the world, the solar power industry and alternative energy is steadily gaining traction. So maybe it’s time to think about doing more than just investing in oil.
Should You Buy Solar Energy Penny Stocks?
It is a common misconception that low energy prices hurt solar energy. In fact, Adam Sieminski, administrator of the U.S. Energy Information Administration (EIA) said that oil is not in head-on competition with renewable energy.
Falling oil prices demonstrate the volatility of petroleum sources. On the other hand, increasing crude oil prices usually contribute to a bump in the prices of solar stocks and solar penny stocks.
Additionally, government policies also help protect clean energy industries like solar companies.
For example, the Federal government permits you to deduct 30% of your solar power systems costs from a new installation off your federal taxes using a federal solar tax credit (ITC). This deduction is before state incentives.
For example, a $25,000 solar power system in North Carolina, with a 35% state credit, would yield a total $8,750 in credit. That is the equivalent of 3 ½ years of utilities in North Carolina!
With the emerging market of solar energy, comes a unique investment opportunity. It is no surprise that big oil has also been investing money in alternative energy assets for years. With oil prices so low, renewable projects forecasted as steady long-term investments, and the low costs of solar energy penny stocks and solar stocks, it may be just the optimal time to start investing.
Is It the Best Time to Invest in Solar Energy Penny Stocks?
A penny stock typically refers to a small company’s stock that trades for less than $5.00 a share. There are some key players in the solar industry and solar companies that fit this description.
Currently, the solar industry goes through big annual swings in demand for new panels and equipment from solar companies and solar manufacturers. This is mainly due to the ebb and flow of spending to build large-scale solar projects from one year to the next.
Solar power demand growth rose 34 percent in 2016 and 31 percent in 2017.
However, the solar industry experienced significant changes in 2018. China and the United States represent two of the world’s largest solar panel markets for solar manufacturers.
In early 2018, the Trump administration imposed a 30 percent tariff on the large majority of foreign solar panels imported into the U.S. Afterward, in mid-2018, China decided to cut its domestic incentives.
These two significant changes in policy left solar panel makers with more of manufacturing capacity and associated expenses than actual demand.
Despite the 30 percent tariffs, the U.S. added more solar power than any other type of electricity in the first quarter of the year. By the end of 2018, residential and commercial solar sales have already begun to stabilize and are hinting gross margins of approximately 20% combined.
Moreover, demand for residential energy storage in the U.S. soared 60% in the second quarter. It is expected to rise by nearly 1000% between 2017 and 2023. The U.S. Energy Information Administration forecasts the solar industry will grow 500% by 2040, doubling in size.
A U-shaped recovery is projected in 2019. The global solar demand is optimistic and demand is predicted to recover to 12% this year.
With the average cost of a solar panel decreasing by over 60% since 2010 and other technological advances in the solar space, the falling prices of solar energy help support the demand growth. This renewable energy sector is set for a strong rebound in 2019.
Best Solar Energy Penny Stocks List
The solar energy industry is going strong but how do you know which solar companies or solar energy penny stocks are the best to buy? We have created a go-to list of the best solar energy penny stocks right now. Take the time to research, learn, and find the right fit for your portfolio.
Solar Penny Stocks to Buy: Capstone Infrastructure Corporation (MCQPF)
Capstone Infrastructure Corporation invests in an extensive collection of alternative energy technologies. It is an international operator and developer of green infrastructure assets and utilities.
Their Amherstburg Solar Park is a 20MW crystalline solar photovoltaic (PV) power project in Ontario. It uses SunPower’s proprietary system, which is designed to follow the sun during the day. As a result, it increases the daily production by up to 30% more than fixed-tilt installations.
What makes this penny stock attractive is its low maintenance and capital expenditure requirements, which support low variable cash flow. As of 2015, MCQPF had four key contracts:
Engineering, Procurement, and Construction (EPC) Agreement
Power Purchase Agreement under the Province of Ontario’s Renewable Energy Standard Offer Program
Operations and Maintenance (O&M) Agreement
Solar Penny Stocks to Buy: Yingli Green Energy Holdings Ltd. (YGE)
Yingli Green Energy Holdings Ltd. (YGE) is one of the largest solar panels manufacturers in the world. This Chinese producer has an international market and sells photovoltaic modules. What sets this company apart is that it sells its product to sizeable wholesalers through its global subsidiaries.
It has distributed more than 20 GW solar panels, or over 85 million Yingli solar panels, to customers worldwide. This solar penny stock has a vertically-integrated business model, which covers the entire solar panel production. Since 1998, their manufacturing capacity has increased from 3MW to 4GW to date.
Solar Penny Stocks to Buy: Spire Corporation (SPIR)
Spire Corporation (SPIR) provides and distributes solar energy generating systems to commercial and residential consumers in the United States. It develops and manufactures capital equipment and services for the solar photovoltaic industry. What makes this solar penny stock unique is its turn-key solutions.
This stock is the true definition of a penny stock, as it sells for $0.01 a share.
Solar Penny Stocks to Buy: 5N Plus Inc. (VNP.TO)
5N Plus Inc. is a unique penny stock for the solar industry. VNP operates in two sectors: electronic materials and eco-friendly materials, such as renewable energy. This company does not actually produce photovoltaic cells. Instead, it is a supplier of the essential raw materials for the production of solar products.
As of April 26, 2019, it sells for C$3.56 a share. It caters to an international market by producing and selling specialty chemicals and engineered materials. VNP also supplies cadmium telluride cells to First Solar, the largest Canadian solar panel company.
Solar Penny Stocks to Buy: Carmanah Technologies Inc. (CMH.CA)
Carmanah Technologies is a Canadian based company that specializes in LED lighting and solar cell technologies. They provide solar lighting solutions for infrastructure projects around the world, currently in 110 countries.
Although it currently sells for C$6.90 per share, which is approximately a bit over USD 5.00, its 52-week range interval was C$3.39 to C$7.04.
Solar Penny Stocks to Buy: LDK Solar Company (LDKYQ)
It should come as no surprise that LDK Solar Company is another Chinese solar penny stock. This company develops, designs, manufactures and markets photovoltaic solar cells and equipment to establish renewable energy generators
What is worth noting is that this company sells to farming enterprises all across China. It also sells products to Europe, the Asia Pacific, and North America.
Currently, it sells for $0.0105 per share with a 52-week range of $0.0001 to $0.08.
Solar Penny Stocks to Buy: Envision Solar International (EVSI)
Envision Solar International (EVSI) is a California based corporation that engineers and produces solar technology-based products for the United States. A significant feature that sets Envision apart from its competitors is that it designs products for areas that it is impossible to connect to the utility grid.
It has increased revenue from year to year and contracts with Google, Johnson & Johnson as well as the City of New York. However, it is still without a positive gross profit margin, has financial debt, and an asset to liability ratio below one.
As a result, it was expected to begin trading trade on The NASDAQ Capital Market on April 16, 2019, which may increase its liquidity in the market and increase its valuation. EVSI priced 2 million units at $6.00 per unit for estimated gross proceeds of $12 million in the public offering.
What is particularly remarkable about this solar penny stock is the flurry of press regarding their new contracts. In January 2019, the city of Fort Lauderdale selected Envision Solar’s EV ARC product to provide emission-free EV charging for its fleet vehicles.
Then in March 2019, it was announced that Envision Solar EV ARC solar charging stations will be available at Washington State Park in the spring.
As of April 26, 2019, EVSI sells for $5.25, with a 12-month high at $17.00 per share and a low of $5.23 per share. The company achieved record revenue of $6.2 million in 2018, which is a 336% increase over 2017. This revenue was made through customer orders of Envision Solar’s EV ARC products from government and enterprise clients.
Solar penny stocks are forecasted to have a good year. 2019 is set to be a solid rebound from the significant policy changes with the United States and China. With the falling cost of solar panels and battery storage systems, the demand for renewable energy is growing.
In addition to penny stocks, the remarkable growth in the solar industry has also caused several larger stocks to develop a household name. Now on analysts’ radar, stocks like First Solar (FSLR), Pattern Energy Group (PEGI), TerraForm (TERP), and SunPower (SPWR) have become buzzwords. The solar industry is looking towards a bright year all on fronts.
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