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 forecasts that offshore wind sources, for example, will increase dramatically in the coming 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), dramatically outperformed the broader stock market in the past year by posting a 81.5% total return. The Russell 1000 had a total return of 53.5%. These figures and all statistics in the tables below are as of March 15.
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|
|General Electric Co. (GE)||13.35||117.1||23.4|
|Northland Power Inc. (
|Vestas Wind Systems A/S (
- General Electric Co.: General Electric is a global industrial company with five segments: power, renewable energy, aviation, healthcare, and financial services. Last year, the renewable energy business lost $715 million on revenue of $15.7 billion, which accounted for about 20% of revenue.
- Northland Power Inc.: Northland Power is a Canada-based power producer with facilities in Asia, Europe, Latin America, and North America that produce electricity from wind, natural gas, and solar. Its Q4 2020 net income fell by 55.8% year-over-year (YOY), although sales rose by 12.5%. Costs were higher due to increased hiring and as management integrated the acquisition of EBSA, a regulated power distribution utility in Colombia, which was purchased on in January of 2020.
- Vestas Wind Systems A/S: Vestas Wind Systems is a Denmark-based wind energy company that designs, manufactures, and installs wind turbines used to generate electricity. In December, Vestas received the required regulatory approval on its previously announced deal with Mitsubishi Heavy Industries Ltd. Under the arrangement, which strengthens the partnership between the two companies, Vestas Wind Systems acquired Mitsubishi’s shares in the MHI Vestas Offshore Wind joint venture. As part of the transaction, Mitsubishi also gained a 2.5% stake in Vestas and will nominate someone to sit on Vestas’ Board of Directors.
These are the wind energy stocks with the highest year-over-year (YOY) operating income growth, or least income decline for the most recent quarter. A company’s ability to maintain profitability in a difficult business environment can be a sign of good management and/or a strong business model. Operating income excludes non-operating income and expenses (such as investment gains or losses), one-time items, as well as interest and taxes. This helps investors get a clearer picture at the strength of the underlying business without the effect of unusual one-off events, such as large tax credits, asset sales, or lawsuit settlements. If you decided to invest in a company, it’s still important to look at these one-off non-operating expenses and incomes, as they can still influence a company’s overall financial health.
|Wind Energy Stocks With the Most Profit Growth or Least Profit Decline|
||Price ($)||Market Cap ($B)||Operating Income Growth (%)|
|TPI Composites Inc. (
|TransAlta Renewables Inc. (
|Vestas Wind Systems A/S (VWDRY)||62.47||37.7||-4.6|
- TPI Composites Inc.: TPI Composites manufactures and services composite wind blades for the wind energy market. It has a global presence, with operations in the U.S., China, Mexico, Turkey, and India. For Q4 2020, the company reported a 30.6% increase in operating income to $24.4 million, which excludes restructuring charges, loss on the sale of assets, and impairments. Sales grew 10.3% YOY.
- TransAlta Renewables Inc.: TransAlta Renewables develops, owns, and operates renewable power generation assets, including wind, hydro, battery storage, and natural gas facilities. It also owns interests in wind facilities, solar projects, and gas-fired generation assets.
- Vestas Wind Systems A/S: See above for company description.
These are the wind energy stocks that had the highest total return over the last 12 months.
|Wind Energy Stocks with the Most Momentum|
||Price ($)||Market Cap ($B)||12-Month Trailing Total Return (%)|
|American Superconductor Corp. (
|TPI Composites Inc. (TPIC)||53.97||2.0||285.8|
|Siemens Gamesa Renewable Energy SA (
|First Trust Global Wind Energy ETF (FAN)||N/A||N/A||81.5|
- American Superconductor Corp.: American Superconductor is a renewable energy company offering products such as electric control systems, power converters, voltage solutions, and generators. The company reported a $7.9 million net loss in its fiscal third quarter ended Dec. 31, 2020 compared to a $6.8 million net loss a year ago. The wider loss came despite a 31.9% YOY increase in revenue.
- TPI Composites Inc.: See above for company description.
- SiemensGamesa Renewable Energy SA: SiemensGamesa Renewable Energy, based in Spain, manufactures wind turbines.
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Global Wind Energy Council. “Global Offshore Wind Report 2020.” Accessed March 16, 2021.
YCharts. “Financial Data.” Accessed Dec. 3, 2020.
TPI Composites Inc. “TPI Composites, Inc. Announces Third Quarter 2020 Earnings Results – Net Sales Increase by 23.5% – Net Income of $42.4 million and Adjusted EBITDA of $49.1 million – Provides 2020 Guidance.” Accessed Dec. 3, 2020.
Northland Power Inc. “Northland Power Reports Fourth Quarter and Full Year 2020 Results.” Accessed March 16, 2021.
Vestas Wind Systems A/S. “Vestas and Mitsubishi Heavy Industries Close Partnership Agreement.” Accessed March 17, 2021.
TPI Composites Inc. “TPI Composites, Inc. Announces Fourth Quarter and Full Year 2020 Earnings Results.” Accessed March 17, 2021.
American Superconductor Corp. “Form 10-Q for the period ended December 31, 2020,” Page 4. Accessed March 16, 2021.