As with many alternative energy investments, there’s no bright line as to what makes a “wind stock” as opposed to a company that does other things and merely dabbles in this area.

Consider General Electric (GE), which is undoubtedly a big player in the wind sector, as its onshore wind segment generates billions each year. While those revenue numbers are larger than the entire operations of a few stocks on this list and the stock is incredibly liquid and widely held, the reality is that wind is not a significant driver of GE’s success as a corporate entity.

In other words, while stocks like GE may be more prominent or easy to trade, they are not truly “wind stocks.” Therefore, we decided on the following criteria to focus on this subsector and identify the leading stocks:

Presence in leading green energy indexes. Each stock on this list is a component in the broad S&P Global Clean Energy Index, which represents 100 leading energy stocks focused on alternative power generation and sustainability, as well as the more wind-specific ISE Clean Edge Global Wind Energy Index of roughly 50 leading names worldwide. Not only does a presence in these indexes show leadership in the wind industry, but it also indicates institutional interest from investors looking to buy into these stocks in order to play these themes.

Market capitalization of at least $2 billion. Size isn’t everything, but scale does matter. Considering some of the volatility in alternative energy stocks lately, we biased toward the larger companies to provide the best wind power stocks.

Debt-to-assets ratio of less than 0.8. Alternative energy can be an expensive business, and many firms have taken on large debts to finance potential growth and success. The companies that we included on this list have borrowed more responsibly, however, and have debts that are less than 80% of total company assets.

Accessible OTC securities. Every stock listed here is an “over-the-counter” security that is available to U.S. investors, even if shares aren’t listed on a major exchange like the NYSE or Nasdaq. That provides accessibility but also some challenges. While it’s always important to monitor market conditions and place buy orders responsibly, that’s doubly true with the wind stocks on this list. Many are thinly traded, with only a few thousand shares trading hands each market session, so even a small order can skew prices higher. Make sure you acknowledge this by using limit orders or spreading large trades out into separate orders if you’re planning to invest in these stocks.

Please note that the stocks above were selected by an experienced financial analyst, but they may not be right for your portfolio. Before you decide to purchase any of these stocks, do plenty of research to ensure they are aligned with your financial goals and risk tolerance.

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Investing, Stocks,

Last Update: July 1, 2024

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