Here’s Why You Should Add Clearway Energy Stock to Your Portfolio Now – January 10, 2025

Clearway Energy (CWEN Quick QuoteCWEN – Free Report) continues to benefit from its focus on North American operations and modern utility-scale clean renewable projects that ensure high fleet availability and low maintenance costs. Given its growth opportunities, CWEN makes for a solid investment option in the alternative energy industry.

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Let’s explore the factors that make this Zacks Rank #2 (Buy) company a strong investment pick at the moment.

CWEN’s Growth Projections & Surprise History

The Zacks Consensus Estimate for 2024 earnings per share (EPS) has increased 1.2% to 82 cents in the past 60 days.

The Zacks Consensus Estimate for 2024 sales is pinned at $1.42 billion, indicating a year-over-year increase of 8.3%.

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CWEN’s long-term earnings (three-to-five-year) growth rate is 26.8%. The company delivered an average earnings surprise of 35.8% for the trailing four quarters.

Debt Position of CWEN

Currently, the company’s total debt to capital is 55.95%, much better than the industry’s average of 61.17%. A lower debt-to-capital ratio is often viewed more favorably, since there is less solvency risk.

CWEN’s Liquidity

The company’s current ratio is 1.59, better than the industry’s average of 1.22. A current ratio greater than one indicates that the company has enough assets to liquidate to cover all short-term liabilities, if necessary.

Dividend History of CWEN

The company’s consistent performance helps it continue with its shareholder-friendly moves. It has been paying out dividends consistently since 2015. The utility has been increasing dividends every year since the inception of the payment. In October 2024, CWEN increased its quarterly dividend by 1.7% to 42.4 cents per share from 41.71 cents in the previous quarter. This increase resulted in an annualized dividend of $1.696 per share. The current dividend yield is 6.59%, better than the Zacks S&P 500 composite’s 1.21%.

CWEN’s Focus on Clean Energy

The company owns and operates utility scale and distributed renewable energy and natural gas-fired generation, thermal and other infrastructure assets with proven technologies, low operating risks and stable cash flows. CWEN’s Victory Pass of solar and storage has nearly 649-megawatt capacity. It is a 12-15-year power purchase agreement with diverse investments. As of Sept. 30, 2024, the company’s origination of new power contracts totaled 3.6 gigawatts (GW). Contracted and awarded capacity came in at 1.3 GW. Additionally, CWEN now has over 5 GW of projects in active engagement with corporates and load-serving entities seeking carbon-free energy to power data centers across multiple markets.

CWEN’s Stock Price Performance

In the past six months, the company’s shares have risen 0.8% against the industry’s decline of 10.1%. 

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Image Source: Zacks Investment Research

Other Stocks to Consider

A few other top-ranked stocks from the same industry are Constellation Energy Corporation (CEG Quick QuoteCEG – Free Report) , ReNew Energy Global (RNW Quick QuoteRNW – Free Report) and Excelerate Energy (EE Quick QuoteEE – Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

CEG’s long-term earnings growth rate is 17.27%. The Zacks Consensus Estimate for CEG’s 2024 EPS implies a year-over-year improvement of 65.9%.

The Zacks Consensus Estimate for RNW’s fiscal 2025 EPS implies a year-over-year improvement of 25%. It delivered an average earnings surprise of 15.5% in the trailing four quarters.

EE’s long-term earnings growth rate is 11.18%. The Zacks Consensus Estimate for 2024 EPS implies a year-over-year improvement of 10.8%.