3 Energy Storage Stocks to Watch in 2025
Global markets are revolutionizing with growing environmental concerns and rising attention towards clean energy adoption. Market leaders are capitalizing on this trend by investing in energy storage and technological advancements and shifting their focus to energy-efficient offerings.
Given the industry’s bright prospects, watching fundamentally sound energy stocks, Tesla, Inc. (TSLA), BYD Company Limited (BYDDY), and Enphase Energy, Inc. (ENPH) could be a suitable strategy.
Major economies are rethinking their energy usage and its impact on the surrounding environment, resulting in attempts to emphasize decarbonization and shift towards measures and latest technologies to reduce their carbon footprints. Therefore, recently increased integration of renewables and upgrades in existing infrastructure can be observed.
A report by IEA pointed out that in recent years, investment in clean energy has grown almost twice as much as in fossil fuels. For 2024, the report shows investment of $771 billion in renewable power, investment of $452 billion in grids and storage, and investment of $669 billion in energy efficiency and end-use.
Further, revolutions in the renewable energy sector are favoring the market prospects of the energy storage market. The energy storage market is expected to reach around $99.72 billion by 2029, exhibiting growth at a notable CAGR of 14.31%. The market’s growth is expected to be driven by rapidly rising energy consumption, favorable government policies, and new technologies.
Given the industry’s robust outlook, watching fundamentally strong energy storage stocks TSLA, BYDDY, and ENPH could be wise.
Let’s discuss the fundamentals of these stocks in detail:
Tesla, Inc. (TSLA)
TSLA designs, develops, manufactures, leases, and sells electric vehicles (EVs), and energy generation and storage systems worldwide. The company operates through two segments: Automotive and Energy Generation and Storage. It also offers non-warranty after-sales vehicles, used vehicles, retail merchandise, and vehicle insurance services.
In terms of trailing-12-month EBIT margin, TSLA’s 8.38% is 3.9% higher than the industry average of 8.06%. Likewise, the stock’s trailing-12-month net income margin of 13.07% is significantly higher than the industry average of 4.22%. Also, its trailing-12-month ROCE of 20.65% is 90.6% higher than the industry average of 10.84%.
During the third quarter, TSLA produced approximately 470,000 vehicles, delivered approximately 463,000 vehicles, and deployed 6.9 GWh of energy storage products.
For the third quarter that ended September 30, 2024, TSLA’s total revenues were $25.18 billion, up 7.8% year-over-year, of which its total automotive revenues increased 2% year-over-year to $20.02 billion. Its total gross profit grew 19.6% from the year-ago value to $5 billion. The company’s adjusted EBITDA came in at $4.66 billion, an improvement of 24.1% from the previous year’s period.
In addition, non-GAAP net income and EPS attributable to common stockholders came in at $2.50 billion and $0.72, reflecting growth of 8.1% and 9.1% from the prior year’s quarter, respectively.
Analysts expect TSLA’s revenue for the fourth quarter (ending December 2024) to increase 8.8% year-over-year to $27.37 billion. For the ongoing quarter, its EPS is expected to grow 7.6% year-over-year to $0.76. Also, the company’s revenue and EPS for the fiscal year 2025 are expected to increase 16.7% and 31.2% year-over-year to $116.37 billion and $3.26.
The stock has increased 131.3% over the past six months and 77% over the past year to close the last trading session at $454.13.
TSLA’s robust outlook is reflected in its POWR Ratings. The POWR Ratings are calculated by considering 118 different factors, each weighted to an optimal degree.
The stock has a B grade for Quality and Sentiment. Within the Auto & Vehicle Manufacturers industry, TSLA is ranked #33 of 51 stocks.
Click here to access additional ratings of TSLA for Value, Growth, Stability, and Momentum.
BYD Company Limited (BYDDY)
Headquartered in Shenzhen, China, BYDDY is internationally engaged in the automobile and battery business. The company operates through two segments: Mobile Handset Components, Assembly Service and Other Products; and Automobiles and Related Products and Other Products.
On November 14, BYDDY entered into a strategic partnership with The Singing Machine Company, Inc., a subsidiary of Algorhythm Holdings, Inc., along with Stingray. Under the terms of the agreement, Singing Machine will launch a globally available in-car karaoke microphone, designed to fully integrate with the Stingray Karaoke app and BYD’s infotainment system in its vehicles.
Also, on October 25, BYDDY released its first plug-in hybrid SUV for Paraguayan households, the BYD SONG PRO model. The launch is equipped with BYD’s Super Hybrid DM-i technology and can further expand BYDDY’s new energy product lineup in the Paraguayan market.
For the nine months that ended September 30, 2024, BYDDF reported a total operating revenue of RMB 502.25 billion ($68.80 billion), reflecting 18.9% growth from the prior year’s period. Its total profit for the period grew 20.1% from the year-ago value to RMB 31.32 billion ($4.29 billion).
Also, the company’s net profit came in at RMB 26.25 billion ($3.59 billion), up 17.6% year-over-year, while its EPS increased 18.1% from the prior year’s period to RMB 8.68. Furthermore, the company’s total assets amounted to RMB 764.26 billion ($104.69 billion) as of September 30, 2024, compared to RMB 679.55 billion ($93.09 billion) as of January 1, 2024.
For the fiscal year 2024, the company’s revenue is estimated to grow 25.7% year-over-year to $104.90 billion, and the consensus EPS estimate of $3.78 for the ongoing year indicates an improvement of 39.6% year-over-year.
Over the past six months, BYDDY’s stock has gained 17.6% and 33.2% over the past year to close the last trading session at $71.09.
BYDDY’s POWR Ratings reflect its bright prospects. The stock has an overall grade of B, translating to a Buy in our proprietary rating system.
BYDDY has a B grade for Growth, Sentiment, and Quality. It is ranked #10 among 51 stocks within the Auto & Vehicle Manufacturers industry.
To see the other BYDDY ratings for Momentum, Value, and Stability, click here.
Enphase Energy, Inc. (ENPH)
ENPH designs develops, manufactures, and sells home energy solutions for the solar photovoltaic industry internationally. It offers a semiconductor-based microinverter, which converts energy at the individual solar module level and combines with its proprietary networking and software technologies to provide energy monitoring and control.
On December 9, ENPH announced a collaboration with NextEnergy, one of the most innovative energy providers in the Netherlands. The strategic relationship will empower NextEnergy customers with Enphase solar and battery systems to participate in the grid imbalance energy marketplace in the Netherlands.
Enphase solar and battery systems can use AI optimization to automatically direct electricity toward the home or export it to the grid to help homeowners maximize financial returns.
Also, on December 5, ENPH collaborated with Frank Energie, an energy provider in the Netherlands, to enable Frank Energie customers to use Enphase solar and battery systems. It will help in maximizing customers’ return on investment (ROI) and reduce the system payback period.
During the third quarter that ended September 30, 2024, ENPH’s net revenues increased 25.5% from the prior quarter to $380.87 million, and its gross profit grew 29.9% from the quarter-ago value to $178.17 million. Also, the company’s non-GAAP operating income was $101.41 million, up 66% from the prior quarter.
Additionally, the company’s non-GAAP net income came in at $88.40 million and $0.65 per share, indicating increases of 50.3% and 51.2% quarter-over-quarter, respectively.
Street expects ENPH’s EPS for the fourth quarter (ending December 2024) to grow 39.9% year-over-year to $0.76. The company’s revenue is estimated to increase by 25.2% year-over-year to $378.81 million for the same quarter. For the fiscal year 2025, its revenue and EPS are expected to grow 31.8% and 75.4% from the prior year to $1.75 billion and $3.82.
Shares of ENPH have surged 6.1% over the past month to close the last trading session at $73.01.
ENPH’s sound fundamentals are reflected in its POWR Ratings. ENPH has a B grade for Quality. It is ranked #5 among 15 stocks in the Solar industry.
In addition to the POWR Ratings we’ve stated above, we also have ENPH ratings for Momentum, Growth, Value, Stability, and Sentiment. Get all ENPH ratings here.
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TSLA shares . Year-to-date, TSLA has gained 73.72%, versus a 26.79% rise in the benchmark S&P 500 index during the same period.
About the Author: Rjkumari Saxena
Rajkumari started her career as a writer but gradually shifted her focus to financial journalism, leveraging her educational background in Commerce. Fascinated by the interplay of business and economic shifts in equities, she aspires to evolve as an analyst. With a knack for simplifying complex financial concepts, her mission is to empower investors with insights that lead to profitable decisions. More…