10 Best Solar for February 2026
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Market Overview & Selection Criteria
The renewable energy sector continues to attract attention amid global pushes for sustainable power, with solar, utilities, and power generation leading value opportunities. These top renewable energy stock picks were selected using ValueSense's intrinsic value methodology, prioritizing companies where intrinsic value exceeds current market pricing, strong quality ratings (above 5.0), and favorable metrics like ROIC, margins, and growth potential. Data focuses on market cap leaders in solar and power, filtered for undervaluation signals such as high intrinsic value relative to implied prices, positive revenue trajectories where possible, and balanced debt profiles. This watchlist emphasizes educational analysis of best value stocks in renewables, drawing exclusively from ValueSense metrics for objective insights into undervalued stocks to buy in this high-growth area.
Featured Stock Analysis
Stock #1: Vistra Corp. (VST)
| Metric | Value |
|---|---|
| Market Cap | $54.2B |
| Quality Rating | 6.2 |
| Intrinsic Value | $119.0 |
| 1Y Return | -10.2% |
| Revenue | $4,037.0M |
| Free Cash Flow | $2,381.0M |
| Revenue Growth | (75.2%) |
| FCF margin | 59.0% |
| Gross margin | 39.6% |
| ROIC | 5.0% |
| Total Debt to Equity | 0.0% |
Investment Thesis
Vistra Corp. (VST) stands out with a $54.2B market cap and a Quality rating of 6.2, showcasing robust free cash flow generation of $2,381.0M against revenue of $4,037.0M, yielding an impressive FCF margin of 59.0%. Despite a 1Y Return of -10.2% and revenue growth of 75.2%, the $119.0 intrinsic value suggests significant undervaluation potential in the power generation space. Zero Total Debt to Equity 0.0% provides a clean balance sheet, while ROIC at 5.0% and gross margin of 39.6% highlight operational efficiency for long-term value compounding in renewable and energy markets.
Key Catalysts
- Exceptional FCF margin of 59.0% supports reinvestment and shareholder returns.
- Debt-free structure (0.0% Total Debt to Equity) enables agile capital allocation.
- Large-scale revenue base at $4,037.0M positions for sector recovery.
Risk Factors
- Sharp revenue decline of 75.2% signals volatility in energy pricing.
- Negative 1Y Return of -10.2% reflects short-term market pressures.
- Modest ROIC of 5.0% may lag high-growth peers.
Stock #2: 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), with a $26.0B market cap and Quality rating of 7.0, demonstrates strong scale via revenue of â©97.3T and free cash flow of â©1,457.4B. The $32.2 intrinsic value points to undervaluation, bolstered by a stellar 1Y Return of 175.0% and revenue growth of 5.3%. High gross margin at 60.9% and ROIC of 6.3% underscore efficiency in utilities, though FCF margin is slimmer at 1.5% and Total Debt to Equity is N/A, warranting balance sheet scrutiny for sustained KEP analysis in global energy transitions.
Key Catalysts
- Explosive 1Y Return of 175.0% indicates momentum in power demand.
- Massive revenue scale (â©97.3T) with 5.3% growth supports stability.
- Solid ROIC of 6.3% and gross margin of 60.9% drive profitability.
Risk Factors
- Low FCF margin of 1.5% limits cash flexibility.
- N/A Total Debt to Equity raises leverage opacity concerns.
- Currency exposure in â© metrics adds forex risk.
Stock #3: 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) features a $24.3B market cap, top-tier Quality rating of 7.4, and $174.3 intrinsic value signaling deep value in solar manufacturing. Positive 1Y Return of 34.7%, revenue growth of 31.2%, and FCF of $614.5M on $5,050.6M revenue yield a healthy 12.2% FCF margin. Strong ROIC at 16.2%, gross margin of 40.0%, and low Total Debt to Equity of 6.2% position FSLR as a leader in solar stock picks with scalable growth potential.
Key Catalysts
- Robust revenue growth of 31.2% fuels expansion.
- High ROIC of 16.2% reflects capital efficiency.
- Low debt 6.2% supports margin stability at 40.0%.
Risk Factors
- Sector cyclicality could pressure solar demand.
- FCF margin of 12.2% trails some peers despite positivity.
- Dependence on policy incentives for solar adoption.
Stock #4: 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) boasts a $17.5B market cap and Quality rating of 7.1, with $36.1 intrinsic value highlighting upside in solar tracking tech. Exceptional 1Y Return of 131.3%, 30.0% revenue growth on $3,603.2M revenue, and FCF of $589.3M (16.4% margin) shine, alongside top ROIC of 37.5% and zero Total Debt to Equity 0.0%. Gross margin at 32.4% supports NXT analysis as a high-conviction renewable play.
Key Catalysts
- Stellar ROIC of 37.5% drives superior returns.
- 131.3% 1Y Return and 30.0% revenue growth show momentum.
- Debt-free balance sheet enhances FCF margin of 16.4%.
Risk Factors
- Rapid growth may strain operational scaling.
- Solar supply chain disruptions possible.
- Valuation stretch post strong returns.
Stock #5: 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), at $10.3B market cap with Quality rating of 5.0, offers $217.6 intrinsic value amid chemicals exposure to energy. Despite -31.2% 1Y Return, revenue of $11.5B and gross margin of 8.6% provide scale, though negative FCF of $126.0M, 5.3% revenue growth, 1.1% FCF margin, and 5.8% ROIC flag challenges. Total Debt to Equity at 7.5% is manageable for potential turnaround in value stocks.
Key Catalysts
- High intrinsic value $217.6 vs. current metrics suggests rebound potential.
- Large revenue base $11.5B for cost efficiencies.
- Moderate debt 7.5% allows flexibility.
Risk Factors
- Negative ROIC -5.8% and FCF $126.0M indicate profitability strain.
- Declining revenue 5.3% and weak margins.
- Poor 1Y Return -31.2% reflects sector headwinds.
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Stock #6: Ormat Technologies, Inc. (ORA)
| Metric | Value |
|---|---|
| Market Cap | $7,629.4M |
| Quality Rating | 6.0 |
| Intrinsic Value | $77.2 |
| 1Y Return | 94.5% |
| Revenue | $944.2M |
| Free Cash Flow | ($398.7M) |
| Revenue Growth | 6.1% |
| FCF margin | (42.2%) |
| Gross margin | 28.3% |
| ROIC | 2.9% |
| Total Debt to Equity | 7.4% |
Investment Thesis
Ormat Technologies, Inc. (ORA) has a $7,629.4M market cap, Quality rating of 6.0, and $77.2 intrinsic value in geothermal renewables. Strong 94.5% 1Y Return and 6.1% revenue growth on $944.2M revenue are offset by negative FCF of $398.7M and 42.2% margin. Gross margin of 28.3%, ROIC of 2.9%, and Total Debt to Equity of 7.4% offer a balanced ORA analysis profile.
Key Catalysts
- Impressive 94.5% 1Y Return signals demand.
- Revenue growth of 6.1% in niche geothermal.
- Reasonable debt at 7.4%.
Risk Factors
- Heavy FCF burn (-42.2% margin).
- Low ROIC 2.9% limits efficiency.
- Capex intensity in renewables.
Stock #7: Brookfield Renewable Corporation (BEPC)
| Metric | Value |
|---|---|
| Market Cap | $7,570.4M |
| Quality Rating | 5.6 |
| Intrinsic Value | $412.0 |
| 1Y Return | 65.3% |
| Revenue | $4,142.5M |
| Free Cash Flow | ($801.3M) |
| Revenue Growth | (1.9%) |
| FCF margin | (19.3%) |
| Gross margin | 48.7% |
| ROIC | 1.3% |
| Total Debt to Equity | 139.5% |
Investment Thesis
Brookfield Renewable Corporation (BEPC) at $7,570.4M market cap with 5.6 Quality rating features $412.0 intrinsic value. 65.3% 1Y Return contrasts 1.9% revenue growth on $4,142.5M, with FCF loss of $801.3M and 19.3% margin. Strong gross margin 48.7% but low ROIC 1.3% and high Total Debt to Equity 139.5% define this renewable asset manager.
Key Catalysts
- High intrinsic value $412.0 for long-term assets.
- 65.3% 1Y Return momentum.
- Solid gross margin 48.7%.
Risk Factors
- Elevated debt 139.5% increases leverage risk.
- Negative FCF and low ROIC 1.3%.
- Revenue contraction 1.9%.
Stock #8: Enlight Renewable Energy Ltd (ENLT)
| Metric | Value |
|---|---|
| Market Cap | $6,936.5M |
| Quality Rating | 6.7 |
| Intrinsic Value | $43.5 |
| 1Y Return | 250.8% |
| Revenue | $487.2M |
| Free Cash Flow | ($966.4M) |
| Revenue Growth | 36.0% |
| FCF margin | (198.4%) |
| Gross margin | 59.6% |
| ROIC | 5.2% |
| Total Debt to Equity | 230.8% |
Investment Thesis
Enlight Renewable Energy Ltd (ENLT), $6,936.5M market cap and 6.7 Quality rating, shows $43.5 intrinsic value with blockbuster 250.8% 1Y Return and 36.0% revenue growth on $487.2M. Negative FCF ($966.4M, -198.4% margin) reflects growth investments, balanced by 59.6% gross margin, 5.2% ROIC, but high 230.8% Total Debt to Equity.
Key Catalysts
- Extraordinary 250.8% 1Y Return.
- 36.0% revenue growth in renewables.
- High gross margin 59.6%.
Risk Factors
- Extreme FCF margin -198.4%.
- Very high debt 230.8%.
- Growth capex sustainability.
Stock #9: Algonquin Power & Utilities Corp. (AQN)
| Metric | Value |
|---|---|
| Market Cap | $4,996.2M |
| Quality Rating | 5.8 |
| Intrinsic Value | $8.4 |
| 1Y Return | 50.9% |
| Revenue | $2,387.7M |
| Free Cash Flow | ($309.7M) |
| Revenue Growth | (7.0%) |
| FCF margin | (13.0%) |
| Gross margin | 73.9% |
| ROIC | 2.5% |
| Total Debt to Equity | N/A |
Investment Thesis
Algonquin Power & Utilities Corp. (AQN) with $4,996.2M market cap, 5.8 Quality rating, and $8.4 intrinsic value posts 50.9% 1Y Return despite 7.0% revenue growth on $2,387.7M. FCF loss ($309.7M, -13.0% margin), high 73.9% gross margin, 2.5% ROIC, and N/A debt provide utility stability for AQN analysis.
Key Catalysts
- 50.9% 1Y Return recovery.
- Exceptional gross margin 73.9%.
- Steady revenue scale.
Risk Factors
- Negative revenue growth 7.0% and FCF.
- Low ROIC 2.5%.
- N/A debt transparency.
Stock #10: Enphase Energy, Inc. (ENPH)
| Metric | Value |
|---|---|
| Market Cap | $4,831.6M |
| Quality Rating | 6.5 |
| Intrinsic Value | $37.9 |
| 1Y Return | -40.4% |
| Revenue | $1,512.4M |
| Free Cash Flow | $217.3M |
| Revenue Growth | 21.0% |
| FCF margin | 14.4% |
| Gross margin | 48.3% |
| ROIC | 22.5% |
| Total Debt to Equity | 124.0% |
Investment Thesis
Enphase Energy, Inc. (ENPH), $4,831.6M market cap and 6.5 Quality rating, has $37.9 intrinsic value in solar microinverters. -40.4% 1Y Return contrasts 21.0% revenue growth on $1,512.4M, positive FCF $217.3M (14.4% margin), 48.3% gross margin, 22.5% ROIC, but high 124.0% Total Debt to Equity.
Key Catalysts
- Strong ROIC 22.5% and revenue growth 21.0%.
- Positive FCF margin 14.4%.
- High gross margin 48.3%.
Risk Factors
- Negative 1Y Return -40.4%.
- Elevated debt 124.0%.
- Solar market volatility.
Portfolio Diversification Insights
This stock watchlist clusters heavily in renewables (solar via FSLR, NXT, ENPH, ENLT; power/utilities via VST, KEP, ORA, BEPC, AQN), with WLK adding chemicals diversification. High-quality leaders (FSLR 7.4, NXT 7.1) balance lower-rated (WLK 5.0) for risk spread. Pair strong FCF generators (VST, FSLR, NXT) with growth stories (ENLT, KEP) to mitigate negatives like high debt in BEPC/ENLT. Sector allocation: 70% solar/power, 20% utilities, 10% adjacent—ideal for renewable energy stock picks reducing single-stock exposure while capturing intrinsic value upside.
Market Timing & Entry Strategies
Consider positions during renewable policy tailwinds or energy price dips, targeting entries when prices approach intrinsic values (e.g., VST near $119.0, FSLR at $174.3). Dollar-cost average into high-ROIC names like NXT 37.5% amid volatility, monitoring FCF trends for cash-positive shifts. Use sector rotations from fossil fuels to renewables for optimal timing in investment opportunities, always aligning with personal risk tolerance through ValueSense tools.
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FAQ Section
How were these stocks selected?
These top 10 renewable energy stock picks were chosen via ValueSense intrinsic value tools, focusing on quality ratings above 5.0, undervaluation gaps, and renewable sector relevance for diversified stock picks analysis.
What's the best stock from this list?
Nextracker Inc. (NXT) leads with 7.1 Quality rating, 37.5% ROIC, 131.3% 1Y Return, and zero debt, making it a standout in best value stocks for solar exposure—though all merit review.
Should I buy all these stocks or diversify?
Diversify across solar (FSLR, NXT), utilities (KEP, AQN), and power (VST) to balance growth and stability, avoiding concentration in high-debt names like ENLT or BEPC.
What are the biggest risks with these picks?
Key risks include negative FCF/margins (e.g., ENLT -198.4%, BEPC -19.3%), high debt (BEPC 139.5%, ENLT 230.8%), and revenue volatility (VST -75.2%), plus sector policy dependence.
When is the best time to invest in these stocks?
Target dips toward intrinsic values (e.g., WLK $217.6, BEPC $412.0) during market corrections or renewable incentives, using ongoing stock analysis for entry signals.