Top 6 Wind Energy Stocks

Leader in composite turbine blade manufacturing

TPI Composites is a multi-national independent manufacturer of wind blades made of composite materials, providing a global production base and related precision moulding and assembly systems to original equipment manufacturers (OEM). Although the company started operating in 1968, it was in 2001 that it began to specialize in composite material blades.

They’re a leader in blade production for onshore wind turbines with a 32% market share (2021), with the segment revenue reaching 91%, making them a concentrated thematic pick for green investments. However, their production is well-diversified, with operations in the US, China, India, Turkey, and Mexico.

Additionally, the company has plans to expand into the automotive industry, taking advantage of its composite material specialization to collaborate with electric vehicle manufacturers. Replacing cost-sensitive weight-reducing materials like carbon with their own solutions would reduce the cost of vehicle production.

If the company succeeds in this plan, it would be the perfect synergy of 2 market segments with strong policy-maker support.

Renewable energy leader investing in new projects

Brookfield Renewable Partners is a publicly traded limited partnership (LP) company that operates and develops renewable power generating facilities in North and South America, Europe, and Asia. Its major shareholder is Brookfield Asset Management, one of the world’s largest alternative asset management companies. As a limited partnership, the company is committed to distributing a hefty amount of its profits, with the current annual amount per unit of US$ 1.28 and the projected annual growth of 5-9%.

With US$68b in assets, the company has 24 GW in operating capacity, with wind energy production at 5.9 GW. Meanwhile, the development assets have reached over 100 GW. Recently, Brookfield signed an agreement to acquire Scout Clean Energy for US$1b with the potential to invest an additional US$350m to support further development. This acquisition has brought over 800 MW of operating wind assets and a future pipeline of over 22,000 MW of wind, solar and storage projects.

On the operational side, the company has identified multiple levers for cash flow growth through mergers & acquisitions, margin enhancement, and development — to deliver organic growth annually and a long-term 12-15% ROI.

Renewable company taking advantage of Europe’s energy crisis

A Canadian-based independent power producer operating globally in North America, Europe, Latin America, and Asia. The company focuses on producing electricity from renewable resources — mainly wind, solar, and hydropower.

It controls (or has a stake) in 3.2 GW of operating generating capacity, with approximately half of that coming from wind power. The company has a strong European presence, which is a valuable asset given the rising energy production efforts in the EU. The mid-late stage development projects include offshore wind farms in Poland and Germany with a capacity of over 1.6 GW.

The total pipeline production is 14 GW, geographically diversified over the US, Europe, and Asia. Almost all of these projects include a 20-year service contract. Thus, it is unsurprising to see that the management has a goal to double the EBITDA by the time the majority of the current capacity pipeline goes online in 2026/27.

An uncertain energy landscape in Europe will be a boon for Northland Power considering its extensive European presence. Rising costs of fossil fuels will make wind power a more persuasive investment and should help ensure the company has ample capital at its disposal to bring future projects to generation, helping achieve the goal of doubling EBITDA in the process.

Multi-national conglomerate about to branch out its energy business

General Electric is a multi-national conglomerate operating since 1892 and was one of the 12 original constituents of The Dow Jones Industrial Average index. It operates through four segments: Power, Renewable Energy, Aviation, and Healthcare.

In the last two decades, the company’s performance left a lot to be desired. Thus, the management decided to split the business into three companies focusing on Aviation, Healthcare, and Energy. The energy business will operate under the name GE Vernova, and it will include GE Wind Energy — the branch that is one of the largest wind turbine manufacturers in the world. So far, the company boasts almost 50,000 units installed globally.

While under restructuring, the wind segment does have a 7 GW order backlog and US$1b in revenues, but according to the CEO Larry Culp, it will reach profitability in the mid-2020s.

Recently in May of 20222, the company introduced its new Sierra onshore wind turbine platform. The Sierra base offers a two-part blade system manufactured in partnership with LM Wind Power and TPI Composites. The new two-part system offers a marked improvement in terms of installation and logistics, which should be an appealing value proposition over competitors for when it comes to projects in more difficult geographies.

GE Energy’s LM Wind Power subsidiary is the largest manufacturer of wind turbine blades in the world. Currently, 1 in every 5 turbines use a blade manufactured by LM Wind Power. The hope is that the company is able to maintain and grow this level of market share as demand for turbines increases.

GE Vernova will start trading as a standalone company in 2024.

Market leader in offshore turbine installations

Siemens Energy is a renewable energy company that focuses on power generation and transmission, as well as technical consultancy and operation and maintenance services. It operates globally through 2 segments: Gas & Power and Siemens Gamesa Renewable Energy.

Siemens Gamesa Renewable Energy segment was created from a 2017 merger between Gamesa Corporacion Technologica and Siemens Wind Power. It is notable for the SG 14.0-222 turbine — the largest in the world. The business is the market leader in offshore and #3 in onshore installations, with over 100 GW in wind turbine capacity installed.

Interestingly, Gamesa is the most significant revenue contributor, contributing 36% of sales. Meaning that an investment in Siemens Energy AG focuses on wind energy while adequately diversified over other renewables and accompanying services.

Currently, the company expects a global compound annual growth rate for wind energy at 7%, with offshore installations growing as much as 28% (excluding China). An order book of €35b supports this thesis. However, it is worth noting that short-term geopolitical risks and supply-chain constraints might impact these plans.

Scandinavian energy powerhouse targeting net zero emissions by 2025

Formerly known as DONG Energy, the company adopted the name Ørsted A/S in 2017. It is one of the largest Scandinavian energy companies focusing on sustainable energy, producing 90% of its energy from renewable sources — to reach net zero emissions by 2025.

Ørsted is one of the largest offshore wind power developers, attributing to approx. 25% of global offshore wind capacity (excluding China). It is a state-owned business with the Government of Denmark retaining 50.1% of voting rights. While not always ideal, government control gives it a somewhat conservative risk profile, keeping the debt-to-equity not higher than 25%.

As a top-level operator, Ørsted streamlined the installation process and can construct wind farms even without subsidies — as it recently did on two 240 MW projects in Germany. So far, the company has installed 15,109 MW of capacity, with 3,130 MW under construction and 11,200 MW in awarded projects globally, focusing on the US and Europe.