Clean energy investors have faced another tough year, with many turning away from the renewable energy market. The solar industry, despite its growth, stands as a prime example of this trend. According to the Solar Energy Industries Association (SEIA), the U.S. is expected to add nearly 40 gigawatts of solar energy capacity in 2024—more than double the amount added last year and over three times the amount added in 2022. While solar energy continues to thrive, solar stocks have significantly underperformed. The Invesco Solar ETF (NYSEARCA:TAN), a popular benchmark for the sector, has posted a -35.3% return year-to-date, compared to a 24.3% gain for the S&P 500.
The upcoming Trump presidency is expected to negatively impact renewable energy investments. Trump has consistently criticized clean energy policies, including President Biden’s Inflation Reduction Act (IRA), calling it “the biggest tax hike in history.” Trump has also pledged to rescind any “unspent” funds from the IRA if he returns to the White House.
However, certain renewable energy stocks are defying the trend, showing promising performance despite the overall market challenges. Here are three renewable energy companies that have outperformed this year and could continue to do well in 2025.
Eco Wave Power (NASDAQ:WAVE)
Eco Wave Power, a wave energy company, has seen its stock surge after receiving a key nationwide permit for its wave energy project at the Port of Los Angeles. This permit, granted by the U.S. Army Corps of Engineers, allows Eco Wave to install eight wave energy floaters on the port’s Municipal Pier One. This milestone is expected to boost the company’s revenue in the fourth quarter of 2024, in line with its partnership with Shell Plc. (NYSE:SHEL).
Europe, a leader in ocean energy, is a strong market for Eco Wave Power. The company has already developed its first operational wave energy plant in Gibraltar with EU funding. Eco Wave is also working on a 20 MW wave energy project in Porto, Portugal, which is part of the country’s plan to generate 85% of its electricity from renewable sources by 2030. The company recently received approval to begin construction, with the project set to be completed within two years.
GE Vernova (NYSE:GEV)
GE Vernova, a company spun off from General Electric (NYSE:GE) in 2023, is focused on energy equipment manufacturing and services. It operates in the Power, Wind, and Electrification sectors, positioning itself well to profit from the ongoing growth of the renewable energy market.
Recently, GE Vernova reaffirmed its revenue and cash flow guidance for fiscal year 2024, while also raising its outlook for 2025. The company expects revenues for 2024 to reach the higher end of its guidance, between $34B and $35B, with an adjusted EBITDA margin between 5.5% and 6.0%. It also revised its free cash flow forecast to between $1.3B and $1.7B.
For fiscal year 2025, GE Vernova anticipates revenues between $36B and $37B, an increase from its previous estimate, with adjusted EBITDA margins in the high-single digits and free cash flow between $2B and $2.5B.
Tesla Inc. (NASDAQ:TSLA)
Tesla, a leader in electric vehicle manufacturing, has seen its stock soar by 73.8% year-to-date, reaching near all-time highs. This surge is driven by the expectation that Tesla will benefit from a more supportive regulatory environment under a potential Trump administration, especially in securing approvals for autonomous vehicles as it expands its robotaxi fleet.
However, Wall Street remains cautious, with a “Hold” rating and an average price target of $259.66—significantly lower than the current price of $421.44. Critics point to a similar rally in 2021, which was followed by a steep decline of over 70% in the subsequent 18 months.
While the renewable energy sector faces uncertainty, these companies stand out for their growth and potential to thrive in the coming years.
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