I believe renewable energy is going to outperform the market for the rest of this year and into 2021. There is a massive trend underway, and it pays no mind to the U.S. election, asserts Sean Brodrick, editor of Wealth Wave Megatrends.
Heck, the outlook for this industry keeps getting better. Atlantica Sustainable Infrastructure Plc (AY) — formerly known as Atlantica Yield — is a company with a market cap of $3 billion and a bright future.
Atlantica has renewable energy, natural gas, transmission and transportation infrastructure and water assets around the world. Its natural gas assets include 343 megawatts (MW) of power generation capacity.
It’s not a “pure” renewables play, but it owns 1,551 MW of renewable energy installed generation capacity, 17.5 million cubic feet per day of water desalination assets and 1,166 miles of electric transmission lines.
Atlantica has 27 stable contracts to deliver power and other services, with an average of 18 years remaining on the life of those contracts. It assets are in the U.S., Canada, Mexico, Peru, Chile, Uruguay, Spain, Algeria and South Africa. Talk about worldwide reach.
Here’s something interesting: Atlantica hasn’t experienced any material impact from COVID-19. That’s because its infrastructure assets are essential and backed by long-term, fixed-rate contracts that insulate it from near-term pricing and volume fluctuations.
The bottom line is that Atlantica’s sustainable infrastructure business is resilient. Earnings rose 48% last year. They’re projected to jump 76% this year. And, next year, the estimate is for another 35% rise in earnings.
The stock recently sported a dividend yield of 5.5%. That dividend is projected to grow 4% per year for the next three years. Atlantica next goes ex-dividend on Nov. 27.
