Investing

JP Morgan's 6 Best 2022 Picks in Alt/Solar Energy 

Array Technologies

Albuquerque-based Array Technologies Inc. (NASDAQ: ARRY) is the third of top alt energy picks. The company’s market cap is about $1.82 billion, and it supplies the tracking hardware and software that allow solar panels to follow the sun. J.P. Morgan analysts note a potential headwind from utility-scale project delays but expect the company to post a significantly higher profit in fiscal 2022 and a doubling of that total in 2023.

Array’s price target was cut from $38 to $32, which implies upside potential based on a recent price of around $12.10 of 164%. Shares traded up more than 5% Thursday morning.

Shoals

Shoals Technologies Inc. (NASDAQ: SHLS) manufactures cable assemblies, monitoring systems and other electrical balance of system products for solar energy projects. The company will celebrate its first anniversary as a publicly traded company next week, although, with a share price dip of some 42% since its initial public offering, the celebration could be muted. Strouse believes that Shoals’ “late position in the construction cycle provides some buffer for the company to execute on its backlog with less impact from supply chain disruptions near term.”

The analyst has cut its price target on Shoals from $43 to $37. The new target implies a potential gain of 105%, based on a recent price of around $18. The company’s current market cap is about $3.01 billion.

Generac

In addition to the residential market, Generac Holdings Inc. (NYSE: GNRC) also sells its power generation and storage systems to commercial and light industrial customers. J.P. Morgan’s analysts expect demand to remain “solid” with a higher-than-normal backlog and improving margins related to 2021 price hikes. Generac’s market cap is around $18.9 billion.

The analysts have cut their price target on the stock from $520 to $463. The new target implies an upside of 54.6%, based on a recent price of about $299.40. The stock traded up about 2.7% Thursday morning.

SolarEdge

SolarEdge Technologies Inc. (NASDAQ: SEDG) makes and sells direct current inverter systems for solar energy systems. The company’s market cap is around $12.9 billion. J.P. Morgan expects margins to rebound in the first quarter due to the resumption of production at the company’s plant in Vietnam. The analysts also like SolarEdge’s opportunity in new energy storage sales and its international expansion plans.

The company’s $373 price target was cut to $324, which implies upside potential of 32%, based on a recent price of around $245.20. Shares traded up about 5.7% just before noon Thursday.

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