Solar, Renewables Stocks Crash After Trump Win: Should You Buy Now At Cheap Valuations?

With Donald Trump now president-elect and Republicans likely to control Congress, clean energy stocks are taking a beating.

The Invesco Solar ETF (NYSE:TAN) dropped over 9% last week, dragging it to levels last seen in July 2020. From its January 2021 peak, the TAN ETF is now down more than 70%.

Renewables have also been rattled. The Invesco Global Clean Energy ETF (NYSE:PBD) slid over 5% to hit lows not seen since April 2020.

Sunnova Energy International Inc. (NYSE:NOVA) saw its stock plummet by 45% last week, marking its worst week since its IPO in July 2019. Similarly, SolarEdge Technologies Inc. (NASDAQ:SEDG) dropped 23%, reaching all-time lows.

First Solar Inc. (NASDAQ:FSLR) has fallen to a valuation of just 10 times forward earnings—its cheapest in over four years.

Is this a buying opportunity at depressed valuations, or is the worst yet to come?

Trump's Anti-Green Policy Stance

"We expect rhetoric regarding environmental policy and the sustainability of the [Inflation Reduction Act] to be elevated, which could likely lead to continued volatility in stocks in the Green Capex supply chain, particularly pure-play solar/wind stocks," Goldman Sachs analyst Brian Singer explained in a note Friday.

Expect the incoming Trump administration to prioritize easing tailpipe emission regulations and increase resource development on federal land.

One of the biggest questions ...