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The rally was primarily driven by a rebound in global solar demand, competitive pricing and the potential Chinese subsidies. Some states including California are using solar subsidies to boost the adoption of solar power. Additionally, California’s push to make solar panels indispensable to all new homes built in 2020 and beyond is bolstering the solar industry.
The strongest-ever solar installation and the exemption of tariff on one type of solar panels also added to this upside. The U.S. trade representative relieved the bifacial solar panels from solar tariffs, which are currently 25% of the cost of imported solar panels. Higher oil prices are also contributing to the solar stock rally.
Let’s take a closer look at the fundamentals of TAN.
TAN in Focus
This ETF offers global exposure to the solar industry by tracking the MAC Global Solar Energy Index, holding 23 stocks in the basket. It is moderately concentrated across components with each making up for not more than 10% of the assets. American firms dominate the fund’s portfolio with nearly 51.9% share, followed by China (23%) and Germany (6.9%). The product has amassed $350.9 million in its asset base and trades in a solid volume of around 155,000 shares a day. It charges investors 70 bps in fees per year and has a Zacks ETF Rank #3 (Hold) with a High risk outlook (see: all the Alternative Energy ETFs).
Though most of the stocks in the fund’s portfolio delivered strong returns, some stocks listed on the American stock exchange outperformed. Below, we have highlighted those five best-performing stocks in the ETF with their respective positions in the fund’s basket:
Best-Performing Stocks of TAN
Enphase Energy Inc. (ENPH - Free Report) : The stock has skyrocketed more than 269% in the first half. It has seen a positive earnings estimate revision of 18 cents for this year over the past three months with an expected earnings growth rate of 420%. ENPH currently has a Zacks Rank #2 (Buy) and a favorable VGM Score of B. The stock occupies the top spot in the fund’s portfolio, making up for 7.4% share.
JinkoSolar Holding Company Limited (JKS - Free Report) : The stock has soared about 127% so far this year. It currently has a Zacks Rank #1 (Strong Buy) and an attractive VGM Score of A. The stock has witnessed positive earnings estimate revisions of a penny in the past three months for this year and has an estimated earnings growth rate of 81.71%. It holds the ninth spot in the fund’s basket with 4.4% of the total assets. You can see the complete list of today’s Zacks #1 Rank stocks here.
SunPower Corporation (SPWR - Free Report) : The stock has surged nearly 108% in the first half. It has a Zacks Rank #3 (Hold) and an unimpressive VGM Score of D. The Zacks Consensus Estimate for 2019 has moved north from a loss of 40 cents to a loss of 37 cents over the past three months for this year and represents an earnings growth rate of 48.6% year over year. SunPower is placed at the seventh position, accounting for 5.5% share in TAN.
Vivint Solar Inc. : This stock takes the third rank in the fund’s basket with 3.9% allocation. It has also delivered robust returns of 96.3% in the first half. The Zacks Consensus Estimate for 2019 has moved south to a loss of 4 cents from earnings of 25 cents over the past three months for this year and reflects an earnings growth rate of 69.2% year over year. Vivint Solar has a Zacks Rank of 3 and an unattractive VGM Score of F (read: S&P 500 Hits New High: 10 Top-Performing ETFs YTD).
DAQO New Energy Corp (DQ - Free Report) : This stock takes the #10 spot in the fund’s basket, claiming only 3.9% of the assets. It has jumped 81.4% in the first half and has seen a negative earnings estimate revision of 19 cents for this year over the past 30 days. Its earnings are expected to decline 62.73% for this year. DAQO New Energy is currently a Zacks #3 Ranked player and has a VGM Score of A.
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5 High-Flying Stocks of the Top ETF in 1H
Invesco Solar ETF (TAN - Free Report) topped the list of the best-performing ETFs in the first half with impressive returns of about 51% (read: Solar ETF Hits New 52-Week High).
The rally was primarily driven by a rebound in global solar demand, competitive pricing and the potential Chinese subsidies. Some states including California are using solar subsidies to boost the adoption of solar power. Additionally, California’s push to make solar panels indispensable to all new homes built in 2020 and beyond is bolstering the solar industry.
The strongest-ever solar installation and the exemption of tariff on one type of solar panels also added to this upside. The U.S. trade representative relieved the bifacial solar panels from solar tariffs, which are currently 25% of the cost of imported solar panels. Higher oil prices are also contributing to the solar stock rally.
Let’s take a closer look at the fundamentals of TAN.
TAN in Focus
This ETF offers global exposure to the solar industry by tracking the MAC Global Solar Energy Index, holding 23 stocks in the basket. It is moderately concentrated across components with each making up for not more than 10% of the assets. American firms dominate the fund’s portfolio with nearly 51.9% share, followed by China (23%) and Germany (6.9%). The product has amassed $350.9 million in its asset base and trades in a solid volume of around 155,000 shares a day. It charges investors 70 bps in fees per year and has a Zacks ETF Rank #3 (Hold) with a High risk outlook (see: all the Alternative Energy ETFs).
Though most of the stocks in the fund’s portfolio delivered strong returns, some stocks listed on the American stock exchange outperformed. Below, we have highlighted those five best-performing stocks in the ETF with their respective positions in the fund’s basket:
Best-Performing Stocks of TAN
Enphase Energy Inc. (ENPH - Free Report) : The stock has skyrocketed more than 269% in the first half. It has seen a positive earnings estimate revision of 18 cents for this year over the past three months with an expected earnings growth rate of 420%. ENPH currently has a Zacks Rank #2 (Buy) and a favorable VGM Score of B. The stock occupies the top spot in the fund’s portfolio, making up for 7.4% share.
JinkoSolar Holding Company Limited (JKS - Free Report) : The stock has soared about 127% so far this year. It currently has a Zacks Rank #1 (Strong Buy) and an attractive VGM Score of A. The stock has witnessed positive earnings estimate revisions of a penny in the past three months for this year and has an estimated earnings growth rate of 81.71%. It holds the ninth spot in the fund’s basket with 4.4% of the total assets. You can see the complete list of today’s Zacks #1 Rank stocks here.
SunPower Corporation (SPWR - Free Report) : The stock has surged nearly 108% in the first half. It has a Zacks Rank #3 (Hold) and an unimpressive VGM Score of D. The Zacks Consensus Estimate for 2019 has moved north from a loss of 40 cents to a loss of 37 cents over the past three months for this year and represents an earnings growth rate of 48.6% year over year. SunPower is placed at the seventh position, accounting for 5.5% share in TAN.
Vivint Solar Inc. : This stock takes the third rank in the fund’s basket with 3.9% allocation. It has also delivered robust returns of 96.3% in the first half. The Zacks Consensus Estimate for 2019 has moved south to a loss of 4 cents from earnings of 25 cents over the past three months for this year and reflects an earnings growth rate of 69.2% year over year. Vivint Solar has a Zacks Rank of 3 and an unattractive VGM Score of F (read: S&P 500 Hits New High: 10 Top-Performing ETFs YTD).
DAQO New Energy Corp (DQ - Free Report) : This stock takes the #10 spot in the fund’s basket, claiming only 3.9% of the assets. It has jumped 81.4% in the first half and has seen a negative earnings estimate revision of 19 cents for this year over the past 30 days. Its earnings are expected to decline 62.73% for this year. DAQO New Energy is currently a Zacks #3 Ranked player and has a VGM Score of A.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>