2024 has been an overwhelming year for the global solar industry, with photovoltaic (PV) installations witnessing immense growth worldwide. Impressively, the worldwide solar industry reached a historic milestone of 2 terawatts (TW) of installed solar PV capacity in November 2024, per a report from the global solar council.
The significant growth of the industry in 2024 remains commendable, considering the slowed demand trend observed in Europe’s solar market, with this region constituting 19% share of the global solar industry, as of 2023 (according to SolarPower Europe). Notably, Europe’s solar industry grappled with multiple challenges like an oversupply of panels, tough competition with nations offering cheaper solar products as well as lower utility rates.
Investors interested in solar stocks might want to keep a strong focus on eminent stocks from the Zacks solar industry, like First Solar FSLR, Enphase Energy ENPH, Nextracker NXT and Canadian Solar CSIQ.
However, before jumping into what makes these stocks attractive for one’s watchlist, let’s delve into what we can expect from the global solar industry in 2025.
The prediction map for the global solar industry in 2025 does not seem to be as rosy as it was for 2024. Notably, factors like increasing data center growth, more customers opting for sustainable energy solutions, and reduced solar panel prices lowering installation costs, which boosted the industry in recent times will continue to do so in 2025. However, some critical challenges are expected to overcast the industry's overall performance.
In particular, the installation trend in some major nations contributing to the global solar industry is expected to suffer. While increased tariffs on imported modules might hurt Brazil’s solar market, solar installations in India might suffer from delays in grid connectivity, challenges with land acquisition and a shortage of modules meeting domestic content requirement standards.
On the other hand, limited grid capacity and the growing need to curtail solar generation are projected to hurt installations in China, which constitute more than 50% of global solar installations.
Consequently, global solar installations are estimated to fall 0.4% from the 2024 level to 492 gigawatts in 2025.
However, one must not lose all hope in solar stocks. This industry has weathered more difficult storms in the past, like the COVID-19 pandemic, with flying colors.
Considering the aforementioned discussion, one can keep the following four stocks on their watchlist that might beat the market in 2025. Impressively, each of them holds a favorable Zacks Rank, solid growth prospects, and a strong presence in the global solar industry that should shield them from sudden losses in times of crisis.
First Solar: This Zacks Rank #3 (Hold) company is the world’s largest thin-film PV solar module manufacturer and the largest PV solar module manufacturer in the Western Hemisphere. First Solar enjoys a solid global presence, with its well-established footprint in the solar markets of the United States, India, Malaysia and Vietnam. To meet the growing solar demand, FSLR is vigorously enhancing its manufacturing capacity, with the company expecting its annual manufacturing capacity to exceed 25 GW by the end of 2026.
Looking ahead, the stock boasts a long-term (three-to-five years) earnings growth rate of 43.4%. The consensus estimate for FSLR’s 2025 sales is pegged at $5.53 billion, implying an improvement of 32.8% from the prior-year expected figure.
Enphase Energy: This Zacks Rank #3 company is a leading manufacturer of solar microinverters and batteries, along with comprehensive home energy systems. It supplies its products to different parts of the world, which include countries throughout Europe, Australia, the Netherlands, Austria, Mexico, Canada and Puerto Rico, in addition to the United States (where it is based). Lately, the company has been signing multiple contracts with distributors to boost the sale of its products worldwide.
The stock boasts a long-term earnings growth rate of 3.6%. The consensus estimate for ENPH’s 2025 sales is pegged at $1.70 billion, suggesting an improvement of 27.7% from the prior-year expected figure.
Nextracker: This Zacks Rank #2 (Buy) company has been the number-one global market-share solar tracker company with an average market share of 30% for seven years and counting, according to international research firms WoodMackenzie and IHS Markit (as stated by NXT). The company has installed and operated more than 100 GW of projects around the world, with its global offices spanning India to Mexico, China to Brazil, and Spain.
The consensus estimate for NXT’s 2025 sales is pegged at $3.17 billion, reflecting an improvement of 11.1% from the prior-year expected figure. The consensus estimate for NXT’s 2025 earnings is pegged at $3.44 per share, suggesting an improvement of 5.7% from the prior-year expected figure.
Canadian Solar: This Zacks Rank #2 company has successfully delivered more than 118 GW of premium quality modules to customers in over 150 countries over the past 22 years. It caters to a geographically diverse customer base across key markets in the United States, China, Japan, the U.K. and Canada, Australia and South Korea and emerging markets in Brazil, India, Mexico, Italy, Germany, South Africa and the Middle East.
The stock boasts a long-term earnings growth rate of 25%. The consensus estimate for CSIQ’s 2025 sales is pegged at $7.59 billion, indicating an improvement of 18.4% from the prior-year expected figure. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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