5 Best Solar Stocks to Buy in November 2021

While the COP26 fell short of what environmentalists were expecting, it is nonetheless a step forward. As the global economy pivots towards a low carbon future, solar energy generation would receive an impetus which is positive for solar stocks.

Renewable energy stocks, which also include solar stocks, are a promising long-term investing theme. Meanwhile, solar stocks have come off their 2021 highs and some of them look attractive. Here are the five best solar stocks that you can buy in November 2021.

1. Sunnova (NYSE: NOVA)

Sunnova is among the leading residential solar and energy services providers in the US. The company is also diversifying into EV charging and in October it announced a partnership with ChargePoint. Commenting on the partnership, Bill Loewenthal, Senior Vice President, Product at ChargePoint said “Home EV charging is a significant part of the home energy picture. The ChargePoint partnership with Sunnova will provide connected home EV charging insights that are integrated with residential solar and storage for a complete picture of residential energy consumption.”

Sunnova is a solar stock with strong fundamentals

Sunnova is a solar stock with strong fundamentals. It released its third-quarter earnings last month and said that it added 14,300 new customers in the quarter which took its total customer base to 176,900 at the end of the quarter. While its revenues increased from $50.1 million in Q3 2020 to $68.9 million in Q3 2021, its net losses narrowed from $73.3 million to $25.9 million over the period.

BMO believes NOVA is among the best renewable energy stocks to buy. “NOVA offers exposure to the fast-growing U.S. residential solar market that is energized by government policy goals, EV adoption, and demand for energy storage,” said BMO in its note.

Wall Street analysts are also bullish on the stock and consensus estimates call for an upside of almost 40% over the next 12 months. If you are looking at a solar stock where Wall Street analysts see a massive upside, NOVA looks a good fit.

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2. Enphase Energy (NYSE: ENPH)

Enphase Energy looks like another good solar stock to buy in November 2021. It is the world’s leading supplier of micro inverter-based solar and battery systems. The company has shipped over 39 million microinverters which is a remarkable achievement.

The stock received a boost last year when the S&P 500 added Enphase Energy to the Index. It was a sign of changing times and the prestigious index also added Tesla to the index. While Enphase Energy was trading on a weak note in the second and third quarter, it has bounced back sharply since then and is now up 45% for the year.

ENPH is also expanding in EV charging after solar

Meanwhile, ENPH is also expanding in the EV charging industry and earlier this week it announced the acquisition of ClipperCreek, which provides EV charging solutions. There has been a splendid rally in EV charging stocks after the $1 trillion bipartisan infrastructure bill was passed.

ENPH is a fast-growing company and is expanding both organically as well as inorganically. While the stock has bounced back sharply over the last month, it still looks among the best solar stocks to buy for the long term.

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3. SolarEdge Technologies (NYSE: SEDG)

SEDG stock is down almost 19% in the year. The company makes inverters and power optimizers. These products help improve the DC power to AC power conversion of solar panels. The company released its third-quarter earnings earlier this month and reported record revenues of $526.4 million in the quarter. Its GAAP income was $53 million.

SEDG is a profitable solar stock

While some of the solar companies are posting losses, SEDG is a profitable solar company. The stock has rebounded from its lows and is now green for the year. Wall Street analysts are bullish on the stock and it has 16 buys, six holds, and five buy ratings. However, its median target price of $377 is a premium of only about 4% from these levels. Notably, while SEDG stock has rallied over the last month, in line with other solar stocks, analysts’ target price hasn’t kept pace. That said, SEDG is a good solar stock to buy in November as the world transitions towards solar energy.

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4. Array Technologies (NYSE: ARRY)

Array Technologies is a play in the solar energy industry and makes ground mounting systems for large solar energy projects. Earlier this year, Goldman Sachs had listed the stock as among the best renewable energy companies in North America.

The stock has also risen over the last month and has recouped some of the 2021 losses. However, it is still down 40% for the year. Meanwhile, the stock’s valuations look reasonable after the crash and looks like a good solar stock to buy in November.

Wall Street is mixed on this solar stock

Wall Street analysts have a mixed forecast for Array Technologies stock. Of the 13 analysts covering the stock, six have a buy rating while six have a hold rating. One analyst has a sell rating. Its median target price of $27 is a 7.6% premium over current prices.

If you are looking at an ancillary solar stock with good growth prospects, ARRY looks a good fit.

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5. Invesco Solar ETF (NYSE: TAN)

Solar and renewable energy is a long-term investing theme. According to BMO, “Global investment in clean energy is a multitrillion dollar, multidecade effort that will drive secular growth for many companies leading the transition away from carbon through the next several business cycles.”

Solar ETFs can be a good bet

If you want to build a portfolio of solar stocks without having to worry about selecting and buying individual stocks, you can consider an ETF. TAN is among the pure-play solar ETFs which can give you diversified exposure to the sector. ENPH is the top holding for the ETF with a 14.1% allocation while SEDG is second with an allocation of 11.6%. The ETF has an annual expense ratio of 0.69% which is a bit on the higher side.

ETFs can be a good investing strategy especially for investors who lack the time or analytical skills to pick individual stocks. The charges in an ETF are much lower than active funds, which is among the prime reasons for their popularity.

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