High demand from the residential sector, efforts towards lowering costs, and advancement in new technologies are driving the energy storage market’s demand. This demand is propelled by consistent efforts towards renewable energy integration, opening new avenues.
Considering the industry’s rosy prospects, quality stocks NextEra Energy, Inc. (NEE), Brookfield Renewable Partners L.P. (BEP), and Enphase Energy, Inc. (ENPH) could be worth watching amid the energy storage boom.
Considering the depleting state of raw materials required for battery manufacturing and rising residential demand, the energy storage market is experiencing robust growth. Companies are engaging in rigorous research and development activities and investing in renewable energy infrastructure to discover energy alternates, leading to prosperous opportunities for the energy storage market.
According to Global Market Insights, the U.S. energy storage market is expected to witness growth at a CAGR of 13.4%, resulting in a market value of $305.50 billion by 2034. The market growth is attributable to factors like grid modernization efforts, supportive government initiatives, increasing installation of renewable energy, and R&D towards alternate battery chemistries.
Considering the industry’s robust prospects, investing in companies like NEE, BEP, and ENPH could be wise, which are capitalizing on the energy storage boom.
Let’s discuss the fundamentals of these stocks in detail:
NextEra Energy, Inc. (NEE)
NEE generates, transmits, distributes, and sells electric power to retail and wholesale customers. It generates electricity through wind, solar, nuclear, natural gas, and other clean energy and also develops, constructs, and operates long-term contracted assets that consist of clean energy solutions.
On February 14, 2025, NEE’s Board of Directors declared a regular quarterly common stock dividend of $0.5665 per share, reflecting an increase of 10% from the prior year, consistent with the announced plan in 2024, targeting roughly 10% annual growth in dividends. The dividend will be paid on March 17, 2025, to shareholders of record on Feb 28, 2025.
NEE pays an annual dividend of $2.06, which translates to a yield of 3.03% at the current share price. Its four-year average dividend yield is 2.36%. Moreover, the company’s dividend payouts have increased at a CAGR of 10.5% over the past five years. NEE has raised its dividends for 29 consecutive years.
On January 28, 2025, NEE reaffirmed its long-term financial expectations. The company continues to expect adjusted EPS in the range of $3.45 to $3.70 for 2025, $3.63 to $4.00 for 2026 and $3.85 to $4.32 for 2027. Also, its expected funding plan from 2024-2027 remains unchanged, including equity units of $5 billion to $7 billion and asset recycling of $5 billion to $6 billion.
For the fourth quarter that ended December 31, 2024, NEE’s operating revenue was $5.38 billion, and its operating income was $941 million for the same period. Also, the company reported adjusted earnings of $1.09 billion or $0.53 per share, up 2.6% and 1.9% from the prior year’s quarter, respectively.
Analysts expect NEE’s revenue and EPS for the second quarter (ending June 2025) to increase 20.4% and 4.6% year-over-year to $7.31 billion and $1, respectively. Moreover, the company surpassed the consensus EPS estimates in all of the trailing four quarters.
The stock has gained 1.4% over the past month and 21.5% over the past year to close the last trading session at $68.06.
NEE’s solid fundamentals are reflected in its POWR Ratings. The POWR Ratings are calculated by considering 118 different factors, each weighted to an optimal degree.
The stock has a B grade for Momentum. Within the Utilities – Domestic industry, it is ranked #35 among 57 stocks.
Click here to access additional NEE ratings for Value, Stability, Growth, Quality, and Sentiment.
Brookfield Renewable Partners L.P. (BEP)
Headquartered in Toronto, Canada, BEP owns a portfolio of renewable power generating facilities internationally. It generates electricity through hydroelectric, wind, solar, distributed generation, and pumped storage. It also generates electricity through renewable natural gas, carbon capture and storage, recycling, cogeneration biomass, nuclear services, and power transformation.
BEP’s trailing-12-month gross profit margin of 56.09% is 24.4% higher than the industry average of 45.11%. Likewise, the stock’s trailing-12-month EBITDA margin of 52.62% is 41.2% higher than the industry average of 37.26%. And its trailing-12-month CAPEX/Sales of 63.53% is 83.4% higher than the 34.65% industry average.
During the fourth quarter that ended December 31, 2024, BEP’s revenues grew 8.2% year-over-year to $1.43 billion. In addition, the company’s funds from operations amounted to $304 million, or $1.72 per share, indicating increases of 19.2% and 21.1% from the prior-year quarter, respectively.
Furthermore, the company’s cash and cash equivalents and total assets were $624 million and $44.13 billion as of December 31, 2024.
Street expects BEP’s revenue to increase by 15.7% year-over-year to $1.73 billion for the first quarter ending March 2025. The company’s FFO for the ongoing period is expected to grow 7.1% year-over-year to $0.48.
Shares of BEP have surged 1.5% over the past month to close the last trading session at $22.43.
BEP’s POWR Ratings reflect its promising outlook. The stock has a B grade for Momentum. It is ranked #7 in the A-rated MLPs - Other industry.
In addition to the POWR Ratings we’ve stated above, we also have BEP ratings for Growth, Value, Quality, Stability, and Sentiment. Get all BEP ratings here.
Enphase Energy, Inc. (ENPH)
ENPH designs develops, manufactures, and sells home energy solutions for the solar photovoltaic industry internationally. The company offers a semiconductor-based microinverter that converts energy at the individual solar module level and combines it with its proprietary networking and software technologies to offer energy monitoring and control.
On February 11, 2025, ENPH introduced an expanded IQ® Battery 5P™ product with support for both single-phase 120/208 V and split-phase 120/240 V for new home projects in California. The product’s functionality provides an optimal storage solution for new single- and multi-family homes in California.
On January 30, 2025, ENPH expanded its operations in Southeast Asia by entering the solar markets in Vietnam and Malaysia. The company shipped IQ8P™ Microinverters, with peak output AC power of 480 W, for residential and commercial applications in Vietnam and Malaysia to support newer high-powered solar modules.
For the fourth quarter that ended December 31, 2024, ENPH’s net revenues rose 26.5% year-over-year to $382.71 million. Its non-GAAP gross profit came in at $203.75 million, up 33.9% from the previous year’s quarter. Also, non-GAAP income from operations grew 83.6% year-over-year to $120.43 million.
In addition, the company’s net income came in at $125.86 million or $0.94 per share, reflecting growth of 71.3% and 74.1% over the prior year’s quarter, respectively.
Analysts expect ENPH’s revenue to grow 36.1% year-over-year to $358.39 million for the first quarter (ending March 2025). Similarly, the company’s EPS for the ongoing quarter is expected to grow 106% year-over-year to $0.72.
Over the past three months, ENPH’s stock has gained 0.6% to close the last trading session at $63.94.
ENPH’s POWR Ratings reflect its bright prospects. The stock has an A grade for Quality and Growth. It is ranked #2 among 14 stocks within the Solar industry.
To access other ratings of ENPH for Value, Sentiment, Momentum, and Stability, click here.
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NEE shares were trading at $67.96 per share on Tuesday afternoon, down $0.10 (-0.15%). Year-to-date, NEE has declined -5.20%, versus a 4.02% rise in the benchmark S&P 500 index during the same period.
About the Author: Rjkumari Saxena
Rajkumari started her career as a writer but gradually shifted her focus to financial journalism, leveraging her educational background in Commerce. Fascinated by the interplay of business and economic shifts in equities, she aspires to evolve as an analyst. With a knack for simplifying complex financial concepts, her mission is to empower investors with insights that lead to profitable decisions.
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