After years of up and down moments, one analyst believes solar stocks are headed towards a long-term run of prosperous growth.
“I think solar has a good 15 year run ahead of it as part of a major thrust into the mainstream of the market,” said Greg Schnell of Stockcharts.com in a interview from the Canadian Pembina Institute’s weekly web series Green Energy Futures.
Schnell sees solar energy as a new bull market, where it has declines and gains, but overall strongly trends up.
He uses Microsoft stock as a historical case study. In the video, Schnell points out, very early on, Microsoft had gains of 500%. However, consistent 50% corrections occurred, but eventually Microsoft went on a gangbusters run as it pushed towards the mainstream of the stock market.
Schnell believes solar is ripe for it now. In the video, he cites First Solar and Canadian Solar as examples.
“It’s (solar) the sweet spot of investing trying to catch it on the thrust up,” Schnell said.
Schnell also pointed out that catching solar stocks while prices are low and heading up can be very profitable. However, he said solar stocks are very volatile and can move sometimes 50% up or down.
Currently, we are still seeing that volatility. SolarCity stock price has ranged during the year between $42 and $88 a share, and Yingli Solar has ranged from $2.43/share to $7.45/share.
With solar prices having dropped dramatically, investors now could see a bargain with stocks as ongoing concerns about climate change and energy issues help push the market into the mainstream.