10 Best Climatetech for February 2026
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Market Overview & Selection Criteria
The climate tech sector is experiencing robust growth amid global pushes for renewable energy and sustainable infrastructure, with companies spanning electric vehicles, power generation, solar, and environmental services showing varied performance. Value Sense selected these 10 best climate tech stock picks using its proprietary machine learning-driven analysis, focusing on intrinsic value comparisons, quality ratings, ROIC, revenue growth, and free cash flow metrics to identify undervalued opportunities. Stocks were curated from the climatetech watchlist, prioritizing those with strong fundamentals like high gross margins and positive growth trajectories despite market volatility, providing retail investors with a diversified stock watchlist for educational analysis.
Featured Stock Analysis
Stock #1: Tesla, Inc. (TSLA)
| Metric | Value |
|---|---|
| Market Cap | $1,404.2B |
| Quality Rating | 6.5 |
| Intrinsic Value | $41.3 |
| 1Y Return | 7.5% |
| Revenue | $94.8B |
| Free Cash Flow | $6,220.0M |
| Revenue Growth | (2.9%) |
| FCF margin | 6.6% |
| Gross margin | 18.0% |
| ROIC | 5.6% |
| Total Debt to Equity | 10.1% |
Investment Thesis
Tesla, Inc. (TSLA) stands out in the climate tech space with a massive market cap of $1,404.2B, generating $94.8B in revenue and $6,220.0M in free cash flow. Its quality rating of 6.5 reflects solid operational efficiency, with a gross margin of 18.0%, FCF margin of 6.6%, and ROIC of 5.6%, though revenue growth is modest at 2.9% and 1Y return sits at 7.5%. The intrinsic value of $41.3 suggests significant undervaluation relative to market perceptions, positioning TSLA as a core holding for investors analyzing electric vehicle and energy storage leaders. Total debt to equity remains manageable at 10.1%, supporting long-term scalability in sustainable transport.
Key Catalysts
- Strong free cash flow generation at $6,220.0M enables R&D in battery tech and autonomy.
- Leadership in EV market with potential for margin expansion beyond 18.0% gross.
- ROIC of 5.6% indicates efficient capital use in high-growth climate applications.
Risk Factors
- Negative revenue growth of 2.9% amid competitive pressures.
- Low 1Y return of 7.5% signals short-term volatility.
- Dependence on global supply chains for scaling production.
Stock #2: GE Vernova Inc. (GEV)
| Metric | Value |
|---|---|
| Market Cap | $198.1B |
| Quality Rating | 6.2 |
| Intrinsic Value | $217.2 |
| 1Y Return | 89.9% |
| Revenue | $38.1B |
| Free Cash Flow | ($325.0M) |
| Revenue Growth | 8.9% |
| FCF margin | (0.9%) |
| Gross margin | 19.8% |
| ROIC | 8.8% |
| Total Debt to Equity | 0.0% |
Investment Thesis
GE Vernova Inc. (GEV), a power equipment giant, boasts a $198.1B market cap and $38.1B revenue, with impressive 1Y return of 89.9% and revenue growth of 8.9%. Despite negative free cash flow of $325.0M and FCF margin of 0.9%, its quality rating of 6.2, gross margin of 19.8%, and ROIC of 8.8% highlight strengths in renewable energy solutions. Zero total debt to equity at 0.0% provides financial flexibility, while intrinsic value of $217.2 points to undervaluation, making GEV a compelling pick for climate tech stock analysis in wind and grid modernization.
Key Catalysts
- Explosive 1Y return of 89.9% driven by energy transition demand.
- Revenue growth at 8.9% with 19.8% gross margins supporting expansion.
- Debt-free balance sheet (0.0%) aids aggressive investments in green tech.
Risk Factors
- Negative FCF of $325.0M pressures near-term liquidity.
- Low quality rating of 6.2 amid operational challenges.
- Sector cyclicality in power infrastructure.
Stock #3: Ford Motor Company (F)
| Metric | Value |
|---|---|
| Market Cap | $55.4B |
| Quality Rating | 6.1 |
| Intrinsic Value | $15.9 |
| 1Y Return | 41.1% |
| Revenue | $189.6B |
| Free Cash Flow | $11.9B |
| Revenue Growth | 3.7% |
| FCF margin | 6.3% |
| Gross margin | 7.5% |
| ROIC | 2.8% |
| Total Debt to Equity | 346.5% |
Investment Thesis
Ford Motor Company (F) offers a $55.4B market cap with robust $189.6B revenue and standout $11.9B free cash flow (6.3% FCF margin). Quality rating of 6.1, 1Y return of 41.1%, and revenue growth of 3.7% underscore its EV pivot, though gross margin is thin at 7.5% and ROIC at 2.8%. High total debt to equity of 346.5% is offset by intrinsic value of $15.9, suggesting value in hybrid and electric vehicle transitions for undervalued stocks in auto climate tech.
Key Catalysts
- Exceptional FCF of $11.9B funds EV model rollouts.
- 41.1% 1Y return reflects market share gains in electrification.
- Scale from $189.6B revenue provides competitive edge.
Risk Factors
- Elevated debt to equity at 346.5% increases financial risk.
- Low ROIC of 2.8% and 7.5% gross margins limit efficiency.
- Intense competition in mass-market EVs.
Stock #4: Korea Electric Power Corporation (KEP)
| Metric | Value |
|---|---|
| Market Cap | $26.0B |
| Quality Rating | 7.0 |
| Intrinsic Value | $32.2 |
| 1Y Return | 175.0% |
| Revenue | â©97.3T |
| Free Cash Flow | â©1,457.4B |
| Revenue Growth | 5.3% |
| FCF margin | 1.5% |
| Gross margin | 60.9% |
| ROIC | 6.3% |
| Total Debt to Equity | N/A |
Investment Thesis
Korea Electric Power Corporation (KEP) features a $26.0B market cap, quality rating of 7.0, and staggering 1Y return of 175.0%. Revenue of â©97.3T grew 5.3%, with â©1,457.4B free cash flow (1.5% FCF margin) and exceptional 60.9% gross margin. ROIC of 6.3% and intrinsic value of $32.2 indicate undervaluation, despite N/A debt metrics, positioning KEP as a utility powerhouse in Asia's energy transition for best value stocks.
Key Catalysts
- Massive 175.0% 1Y return from nuclear and renewable expansions.
- High 60.9% gross margin on scaled operations.
- Steady 5.3% revenue growth in stable utility demand.
Risk Factors
- Currency and geopolitical exposure in Korean markets.
- N/A debt data warrants caution on leverage.
- Regulatory shifts in energy policy.
Stock #5: First Solar, Inc. (FSLR)
| Metric | Value |
|---|---|
| Market Cap | $24.3B |
| Quality Rating | 7.4 |
| Intrinsic Value | $174.3 |
| 1Y Return | 34.7% |
| Revenue | $5,050.6M |
| Free Cash Flow | $614.5M |
| Revenue Growth | 31.2% |
| FCF margin | 12.2% |
| Gross margin | 40.0% |
| ROIC | 16.2% |
| Total Debt to Equity | 6.2% |
Investment Thesis
First Solar, Inc. (FSLR) has a $24.3B market cap, top-tier quality rating of 7.4, and 31.2% revenue growth on $5,050.6M revenue. Positive $614.5M FCF (12.2% margin), 40.0% gross margin, and 16.2% ROIC shine, with low 6.2% debt to equity. Intrinsic value of $174.3 vs. 34.7% 1Y return highlights solar panel leadership as a prime climate tech investment opportunity.
Key Catalysts
- Explosive 31.2% revenue growth in solar demand.
- Strong 16.2% ROIC and 40.0% margins drive profitability.
- 7.4 quality rating signals superior fundamentals.
Risk Factors
- Commodity price swings in solar materials.
- Policy dependence on subsidies.
- Moderate 34.7% 1Y return amid sector volatility.
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Stock #6: Nextracker Inc. (NXT)
| Metric | Value |
|---|---|
| Market Cap | $17.5B |
| Quality Rating | 7.1 |
| Intrinsic Value | $36.1 |
| 1Y Return | 131.3% |
| Revenue | $3,603.2M |
| Free Cash Flow | $589.3M |
| Revenue Growth | 30.0% |
| FCF margin | 16.4% |
| Gross margin | 32.4% |
| ROIC | 37.5% |
| Total Debt to Equity | 0.0% |
Investment Thesis
Nextracker Inc. (NXT) commands a $17.5B market cap with 7.1 quality rating, 131.3% 1Y return, and 30.0% revenue growth on $3,603.2M. Impressive $589.3M FCF (16.4% margin), 32.4% gross margin, and sky-high 37.5% ROIC are bolstered by 0.0% debt. Intrinsic value of $36.1 suggests upside in solar tracking systems, a high-conviction stock pick for growth-oriented analysis.
Key Catalysts
- Stellar 131.3% 1Y return from solar boom.
- Elite 37.5% ROIC and 16.4% FCF margin.
- Debt-free status enables rapid scaling.
Risk Factors
- Niche dependence on solar tracker demand.
- Potential overvaluation post-rally.
- Supply chain disruptions.
Stock #7: GFL Environmental Inc. (GFL)
| Metric | Value |
|---|---|
| Market Cap | $17.3B |
| Quality Rating | 5.7 |
| Intrinsic Value | $37.4 |
| 1Y Return | -1.5% |
| Revenue | CA$6,915.4M |
| Free Cash Flow | CA$225.7M |
| Revenue Growth | (10.9%) |
| FCF margin | 3.3% |
| Gross margin | 20.5% |
| ROIC | 1.5% |
| Total Debt to Equity | 100.9% |
Investment Thesis
GFL Environmental Inc. (GFL) at $17.3B market cap has a 5.7 quality rating, with CA$6,915.4M revenue but 10.9% growth and -1.5% 1Y return. CA$225.7M FCF (3.3% margin), 20.5% gross margin, and 1.5% ROIC show resilience, though 100.9% debt is notable. Intrinsic value of $37.4 flags potential in waste management for sustainable investment ideas.
Key Catalysts
- Essential services with 20.5% gross margins.
- Positive FCF supports acquisitions.
- Recovery potential post-revenue dip.
Risk Factors
- Revenue decline of 10.9%.
- High 100.9% debt to equity.
- Low 1.5% ROIC.
Stock #8: Pentair plc (PNR)
| Metric | Value |
|---|---|
| Market Cap | $17.1B |
| Quality Rating | 6.5 |
| Intrinsic Value | $120.4 |
| 1Y Return | 1.8% |
| Revenue | $4,128.4M |
| Free Cash Flow | $782.7M |
| Revenue Growth | 0.8% |
| FCF margin | 19.0% |
| Gross margin | 40.1% |
| ROIC | 13.4% |
| Total Debt to Equity | 41.8% |
Investment Thesis
Pentair plc (PNR) features $17.1B market cap, 6.5 quality rating, and strong $782.7M FCF (19.0% margin) on $4,128.4M revenue (0.8% growth). 40.1% gross margin and 13.4% ROIC excel, with 41.8% debt. 1.8% 1Y return and intrinsic value of $120.4 position it for water tech gains in climate resilience.
Key Catalysts
- High 19.0% FCF margin and 13.4% ROIC.
- 40.1% gross margins in pool/fluid solutions.
- Stable growth trajectory.
Risk Factors
- Modest 0.8% revenue growth.
- 41.8% debt exposure.
- Low 1.8% 1Y return.
Stock #9: Westlake Corporation (WLK)
| Metric | Value |
|---|---|
| Market Cap | $10.3B |
| Quality Rating | 5.0 |
| Intrinsic Value | $217.6 |
| 1Y Return | -31.2% |
| Revenue | $11.5B |
| Free Cash Flow | ($126.0M) |
| Revenue Growth | (5.3%) |
| FCF margin | (1.1%) |
| Gross margin | 8.6% |
| ROIC | (5.8%) |
| Total Debt to Equity | 7.5% |
Investment Thesis
Westlake Corporation (WLK) has $10.3B market cap, 5.0 quality rating, but intrinsic value of $217.6 amid -31.2% 1Y return. $11.5B revenue fell 5.3%, with negative $126.0M FCF (-1.1% margin) and -5.8% ROIC, though 8.6% gross margin and low 7.5% debt offer turnaround potential in chemicals for climate materials.
Key Catalysts
- Deep intrinsic undervaluation at $217.6.
- Low 7.5% debt supports recovery.
- Cyclical rebound in commodity demand.
Risk Factors
- Negative ROIC of -5.8% and FCF.
- Revenue drop of 5.3%.
- Weak -31.2% 1Y return.
Stock #10: NuScale Power Corporation (SMR)
| Metric | Value |
|---|---|
| Market Cap | $5,873.3M |
| Quality Rating | 6.1 |
| Intrinsic Value | $4.2 |
| 1Y Return | -25.9% |
| Revenue | $55.7M |
| Free Cash Flow | ($282.4M) |
| Revenue Growth | 654.0% |
| FCF margin | (507.5%) |
| Gross margin | 76.7% |
| ROIC | 4,960.2% |
| Total Debt to Equity | 0.0% |
Investment Thesis
NuScale Power Corporation (SMR) with $5,873.3M market cap shows 6.1 quality rating and explosive 654.0% revenue growth on $55.7M, plus 76.7% gross margin. Despite $282.4M FCF (-507.5% margin), 4,960.2% ROIC and 0.0% debt highlight small modular reactor potential, though intrinsic value of $4.2 and -25.9% 1Y return flag high-risk innovation.
Key Catalysts
- Hyper 654.0% revenue surge.
- Extreme 4,960.2% ROIC in nuclear tech.
- No debt for R&D flexibility.
Risk Factors
- Severe FCF burn at -507.5%.
- -25.9% 1Y return volatility.
- Early-stage commercialization risks.
Portfolio Diversification Insights
These 10 climate tech stocks blend EVs (TSLA, F), power/utilities (GEV, KEP), solar (FSLR, NXT), environmental services (GFL), water/chemicals (PNR, WLK), and nuclear (SMR), offering sector allocation across renewables (~50%), energy transition 30%, and industrials 20%. High performers like NXT (131.3% return) complement stables like KEP (high margins), reducing correlation risks—e.g., solar growth offsets auto volatility—while average quality rating ~6.4 and varied intrinsic values support balanced stock watchlist exposure for portfolio diversification.
Market Timing & Entry Strategies
Consider positions during sector dips, such as post-earnings volatility or policy announcements favoring renewables, targeting entries near intrinsic values (e.g., TSLA at $41.3). Use dollar-cost averaging for high-growth names like FSLR/NXT amid 20-30% pullbacks, monitoring ROIC >10% and positive FCF inflection. Pair with Value Sense screeners for backtested timing on macroeconomic tailwinds like falling rates.
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FAQ Section
How were these stocks selected?
These 10 best climate tech stock picks were chosen via Value Sense's automated analysis, emphasizing intrinsic value gaps, quality ratings above 5.0, ROIC, and growth in climatetech themes for undervalued stocks to buy.
What's the best stock from this list?
Nextracker (NXT) leads with 7.1 quality rating, 131.3% 1Y return, 37.5% ROIC, and strong FCF, though FSLR's 7.4 rating offers close competition—evaluate via personal risk tolerance.
Should I buy all these stocks or diversify?
Diversification across EVs, solar, and utilities (as in this stock watchlist) mitigates risks; allocate 5-10% per stock based on intrinsic value and sector balance rather than full concentration.
What are the biggest risks with these picks?
Key concerns include high debt (F at 346.5%), negative FCF (GEV, SMR), and growth slowdowns (TSLA, GFL), alongside policy and commodity volatility in climate tech investment opportunities.
When is the best time to invest in these stocks?
Optimal entry aligns with market corrections or positive macro shifts like energy subsidies; track Value Sense intrinsic values and ROIC improvements for top stocks to buy now signals.