Solar Stocks: How Scary is the Roller Coaster?
There has been a lot of fear lately, from investors and spectators alike, about the slumping U.S. economy and, more specifically, how it will affect an otherwise booming solar industry. Sure energy costs are at record highs, making solar power a viable option. But people have to have money to spend it – on solar or anything else. I can already feel my knees quaking…but are my shaky knees unnecessary? Are solar stocks untouchable? Or are they poised to fall?
Much of this fear is unnecessary. The solar industry has been growing by roughly 30% a year for the last eight years. Nonetheless, a variety of factors, including a silicon shortage and fluctuating oil prices, are causing solar stock patterns to look like a roller coaster ride. This morning they are down, tomorrow they’ll be up. It seems like a scary picture but it’s called an investment for a reason and, as an investment, solar is looking up.
In recent years it has been the silicon shortage that kept many investors leery. In the last few weeks, it has been dropping oil prices and a dreary outlook for U.S. federal incentives, which are due to expire at the end of 2008 and are held up due to partisan politics in an election year. Yet, regardless of the cause, stocks are generally climbing, especially international solar stocks. Thanks to the long-term tightening of oil supplies, the strength of solar overseas, improving solar technology, and the always-predictable sun, it is looking like a long haul for solar energy. While the ride may feel like a roller-coaster, it is climbing ever up and up.
One more reason for confidence in solar stocks is the recent interest of established, global conglomerates in purchasing solar start-ups. Here is a great article concerning a recent buyout. In addition, considering that I am no stock market analyst, here are some other links that helped me write this post and will hopefully help you:
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Posted on September 15th in Solar News by Dan.