Can Solar Shine Again? Why Clean Energy ETFs May Be Undervalued
Portfolio Pulse from
The article discusses the current downturn in solar energy stocks and ETFs, particularly under the Trump administration's fossil fuel-focused policies. Despite the challenging environment, the author suggests that solar ETFs like TAN and RAYS might represent an undervalued investment opportunity for long-term, risk-tolerant investors.
March 26, 2025 | 2:00 pm
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NEGATIVE IMPACT
RAYS offers a more cost-effective solar ETF option with a lower expense ratio of 0.5%, providing exposure to innovative solar firms at multi-year low prices.
The ETF is positioned as a potentially attractive investment for environmentally-conscious investors willing to wait out current market challenges, with a competitive expense ratio and global solar firm exposure.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 90
NEGATIVE IMPACT
TAN has declined approximately 74% since its 2021 peak, trading near five-year lows. Despite current policy challenges, the ETF might offer value for long-term investors interested in global solar innovation.
The ETF is experiencing significant downward pressure due to unfavorable US energy policies, limited near-term catalysts, and reduced investor interest. However, its low price-to-book ratio suggests potential long-term value.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 100