Solar Stocks Soar on Fed Rate Cuts

Solar stocks got a nice boost this week after the Fed announced its rate cut.

First Solar (NASDAQ: FSLR) and Enphase (NASDAQ: ENPH), in particular, did quite well following that announcement, as you can see here…

Over the past couple years, the solar industry has been hit particularly hard by high interest rates, so the market’s reaction to these rate cuts didn’t come as a surprise.  Heck, just in anticipation of those cuts, we saw Enphase begin a steady climb back on Monday, as you can see in this chart…

If you’re unfamiliar, Enphase is the largest supplier of microinverter-based solar and battery systems in the world.  I actually became interested in the stock a few years ago after doing a site visit at a small solar farm in Vermont.  I had noticed that all the inverters were from Enphase.  So I asked the installer what he thought of them.  He told me that pretty much every installer he knows only uses Enphase, unless, there’s a shortage.  Which can happen from time to time.

So I did a bit of digging and discovered that Enphase inverters were clearly the most popular for installers.  That was back when you could still buy shares for about $50 a pop.  And eventually, ENPH hit a record high of $336 a share.

But in that chart, you can also see how a sharp hike in interest rates correlated with a gutting of the stock.  By October, 2023, the stock had fallen more than 75% after dipping below $80 a share.

Since then, however, ENPH has been inching its way back up.  And certainly this latest rate cut is bolstering the value of the stock.  It also helps that in the world of solar, Enphase is the leader in microinverters.  A good thing to be as the demand for solar continues to grow.

According to data from Bloomberg, the global solar PV industry is expected to install 592 gigawatts of modules this year, up 33% from 2023.  But with interest rate cuts, growth from 2024 to 2025 could exceed 35%.  And while Enphase isn’t the only game in town, it is the “big dog” in the inverter market.

I expect to see Enphase trading at around $134 a share by the end of the year.  Which would equate to a potential gain of around 10% based on current levels.  Not bad.  But you can do better.

Better than Solar Stocks

A couple years ago, I told you about a new solar investment opportunity that was far more profitable than any of the solar stocks out there.  Although, it’s not actually a solar stock, but instead, an investment opportunity that allows you to profit from the same types of private solar deals that guys like Elon Musk, Bill Gates and Jeff Bezos have been profiting from for years.

They’re called private solar royalties, and they allow you to earn monthly income on solar power projects all over the world.  Rates of return on some of these royalty deals exceed an estimated 14%, and you can collect those royalties for as long as 20 years.  And the best part is that these monthly payments are not affected by the public markets because these are not public equities.

So while interest rate hikes gutted the value of dozens of solar companies, including Enphase, the value of these private solar projects remained unchanged.

When it comes to profiting from solar stocks, by far, private solar royalties are my favorite.  They’re profitable, they don’t lose value based on interest rate hikes, and they’re super easy to get.  In fact, in this beginner’s guide to private solar royalties, you can get access to an investment portal that will allow you to start earning your own royalty payments within 24 hours.

And some of these deals are major money-makers.  In fact, there’s one deal that can earn you an estimated $98,325 in royalties on monthly investments of just $100.

I can assure you, you’re not going to earn that with any solar stocks.  And if you don’t believe me, just look at the evidence for yourself.

To a new way of life and a new generation of wealth…

Jeff Siegel

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Jeff is the founder and managing editor of Green Chip Stocks. For more on Jeff, go to his editor’s page.

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