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The global market for solar cells and modules is estimated to hit $89.8 billion by 2017, influenced by surging electricity costs and the growing need for feasible green and sustainable energy alternatives, according to a recent research report by Global Industry Analysts.
Europe represents the largest regional market worldwide, according to the report. However, the solar market is heating up in the Asia-Pacific region with subsidy policies driving growth in the majority of Asian countries, notably China.
The global solar industry sighed in relief after the Italian government signed into law an updated feed-in tariff. The new regulation offers 10% incentive for projects that have at least 60% European content. Analysts believe that the ripple effect of the incentives will not only boost suppliers throughout the industry, but the entire global supply chain.
China now accounts for 70% of the global solar panels market, according to industry analysts. The collapse of three U.S. solar power companies in the past two months has left China's solar industry in a dominant position, relative to its U.S. and European counterparts. Chinese solar companies have a cost advantage: Prices are as low as $1.2 per watt of generation as compared to $1.7 in 2010, and the global average of $2 in 2010.
However, PV installations in the U.S. surged in the second quarter of 2011 by almost 69% to 314 megawatts (powering almost 63,000 homes) from the year-ago period and 17% from the prior quarter, according to a report by the Solar Energy Industries Association and GTM Research.
Wall Street analysts think these stocks have plenty of room to rise, at least judging from their 12-month price targets. Based on the consensus price target for each stock, these seven solar stocks could rise from 46% to 141%.
These stocks are listed in ascending order of potential upside based on analysts' price targets.