Wind energy is part of the fast-growing renewable energy industry, which is designed to produce energy with lower carbon emissions and less pollution. The Global Wind Energy Council notes that the global wind industry has increased dramatically in recent years. There are different facets to the industry, such as developing and managing wind farms, producing and distributing the electricity generated by wind power, and manufacturing, distributing, and maintaining machinery. The size of competitors ranges from small players to large, multinational companies that operate their wind energy business as a division or subsidiary. For instance, General Electric Co. (GE) has a Renewable Energy division.
The wind energy sector, represented by the First Trust Global Wind Energy ETF (FAN), significantly underperformed the broader stock market over the past year. FAN provided a total return of -21.4% over the past 12 months, well below the Russell 1000’s total return of 24.4%. These market performance numbers and all statistics in the tables below are as of Jan. 6, 2022.
Here are the top 3 wind stocks with the best value, fastest growth, and the most momentum.
These are the wind stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated.
|Best Value Wind Energy Stocks|
|Price ($)||Market Cap ($B)||12-Month Trailing P/E Ratio|
|Iberdrola SA (IBDRY)||46.21||72.4||19.3|
|Vestas Wind Systems A/S (VWDRY)||9.44||28.6||31.1|
|TransAlta Renewables Inc. (RNW.TO)||CA$18.26||CA$4.9||33.2|
- Iberdrola SA: Iberdrola is a Spain-based multinational electric utility company. The company engages in the generation, distribution, and trading of electricity. It specializes in clean energy, including onshore and offshore wind. In late Dec. 2021, Iberdrola announced that it had signed maintenance services contracts with Siemens Gamesa for a total of 1,928 MW across 69 of the energy group’s wind farms in Spain and Portugal for a period of between three and five years.
- Vestas Wind Systems A/S: Vestas Wind Systems is a Denmark-based wind energy company that designs, manufactures, installs, and services wind turbines that generate electricity. The company serves customers worldwide.
- TransAlta Renewables Inc.: TransAlta Renewables is a Canada-based power generation company. The company owns and operates renewable power generation facilities, including wind, hydro, and gas. In December, TransAlta announced that its 206.4 MW Windrise wind facility in Alberta achieved commercial operation on Nov. 10, 2021. The company also announced that its indirect wholly-owned subsidiary, Windrise Wind LP, priced a secured green bond offering through a private placement for approximately $173 million. The facility is TransAlta’s largest wind farm to date.
These are the top wind energy stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and their most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one or the other figure unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of over 2,500% were excluded as outliers.
|Fastest Growing Wind Energy Stocks|
|Price ($)||Market Cap ($B)||EPS Growth (%)||Revenue Growth (%)|
|TransAlta Renewables Inc. (RNW.TO)||CA$18.26||CA$4.9||250.0||20.0|
|Iberdrola SA (IBDRY)||46.21||72.4||7.9||19.8|
|Boralex Inc. (BLX.TO)||CA$31.91||CA$3.3||N/A (see company description)||20.0|
- TransAlta Renewables Inc.: See above for company description.
- Iberdrola SA: See above for company description.
- Boralex Inc.: Boralex is a Canada-based electricity producer engaged in the development, construction, and operation of renewable energy power stations. The company operates wind, hydroelectric, thermal, and solar segments. Boralex reported widening net losses YOY for Q3 2021, as revenue increased 20.0%. Revenue growth was driven by strong results in the company’s solar power and hydroelectric power stations. Because the company reported negative EPS in the most recent quarter, an EPS growth rate could not be calculated for the table above.
These are the wind energy stocks that had the highest total return over the last 12 months.
|Wind Energy Stocks with the Most Momentum|
|Price ($)||Market Cap ($B)||12-Month Trailing Total Return (%)|
|NextEra Energy Inc. (NEE)||85.77||168.3||11.5|
|General Electric Co. (GE)||99.95||109.8||10.3|
|Iberdrola SA (IBDRY)||46.21||72.4||-19.7|
|First Trust Global Wind Energy ETF (FAN)||N/A||N/A||-21.4|
- NextEra Energy Inc.: NextEra Energy is a holding company which, through subsidiaries, provides electric power and energy infrastructure products and services. The company operates a diversified clean energy business and provides electric utility services. On Nov. 30, NextEra Energy announced that a subsidiary of NextEra Energy Resources had entered into an agreement to sell a 50% non-controlling interest in a roughly 2,520 megawatt portfolio of renewable assets to the Ontario Teachers’ Pension Plan Board. The Pension Plan Board is a leading infrastructure investor and one of the largest pension plans in the world. The remaining 50% interest will be sold to NextEra Energy Partners LP (NEP). The total consideration for the Pension Plan Board sale is $849 million.
- General Electric Co.: General Electric sells a diverse range of products and services, including aircraft engines, water processing, industrial products, and business and consumer financing. It also offers power generation, including renewable energy generation such as wind and hydro.
- Iberdrola SA: See above for company description.
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Global Wind Energy Council. “Global Offshore Wind Report 2021.” Accessed Jan. 9, 2022.
YCharts. “Financial Data.” Accessed Jan. 9, 2022.
Iberdrola SA. “Siemens Gamesa and Iberdrola sign contracts to maintain nearly 2 GW at 69 wind farms in Spain and Portugal.” Accessed Jan. 9, 2022.
TransAlta Renewables Inc. “TransAlta Renewables Announces Commercial Operation of Windrise and Pricing of $173 Million Project Financing.” Accessed Jan. 9, 2022.
Boralex Inc. “Interim Report 3 as at September 30, 2021,” Page 28. Accessed Jan. 9, 2022.
NextEra Energy Inc. “NextEra Energy announces agreement to sell a 50% interest in an approximately 2,520-megawatt portfolio renewables project to a third party, highlighting the value of its best-in-class development program.” Accessed Jan. 9, 2022.