The renewable energy sector should emerge stronger than ever as a result of the global imperative to address climate change and limit global warming. Predicated on this, we think the two leaders in this sector—NextEra Energy (NYSE:NEE) and Brookfield Renewable Partners (NYSE:BEP)—have the potential to generate high investment returns and solid growth over the coming months as their cash-generating assets continue to expand. But which name is the better investment today? Read on, let’s evaluate.After a stellar rise in 2020, stocks in the renewable energy space have lost momentum this year. Investor concerns around valuation and a rise in interest rates have contributed to a broader market sell-off in 2021.
Two renewable energy stocks that have managed to generate outsized returns for investors over the long term are NextEra Energy (NEE) and Brookfield Renewable Partners (BEP). Both these stocks have trailed the market this year, however. While NextEra is down 10.4% this year, Brookfield Renewables has lost close to 20% in 2021.
So, let’s take a detailed look at these two companies’ business models to ascertain which is a better contrarian bet currently.