1 Ridiculously Undervalued Growth Stock Down 40% to Buy Hand Over Fist

Don’t miss your chance to load up on this high-yielding, renewable energy growth stock.

Nicholas Dobroruka

Nik has been writing for The Motley Fool Canada since 2020. After studying marketing at University in his hometown of Montréal, Nik decided to pack up and move west to Vancouver. By day, Nik is a digital media ninja, specializing in Programmatic advertising. By night, you can find him either Mountain biking in Vancouver’s famous North Shore trails or writing for TMF Canada. Tech, digital payments, and renewable energy are three areas that Nik enjoys following and writing about.

Published June 14, 2024 10:00 am EDT

There are not many stocks on the TSX that can claim to be both high-yielding and growth stocks. Typically, dividend stocks with high yields are not known for their market-beating returns, and growth stocks are not typically known for paying high-yielding dividends, let alone a dividend at all — that is, until the renewable energy space began its spiral downward.

Now is the time to load up on renewable energy stocks

The renewable energy sector as a whole has been on the decline since early 2021. Leaders across the space have seen shared prices gradually decline for most of the past three years.

For short-term investors, aside from the passive income, there might not be a whole lot of interest in renewable energy stocks. We very well could see the sector continue its downward spiral in the coming months. But for those with long-term time horizons, there’s plenty of value to be captured.

Even with the recent skid, many of the beaten-down renewable energy stocks have still outperformed the market’s returns over the past five years. And that’s not even including dividends, where yields have surged with the pullbacks in price.

There is loads of growth potential ahead in the renewable energy space. Long-term investors would be wise to have at least one discounted green energy stock on their watch list today.

Brookfield Renewable Partners

If you’re looking for instant exposure to the growing renewable energy space, you cannot go wrong with a market leader like Brookfield Renewable Partners (TSX: BEP.UN).

The $20 billion company does it all. It owns a well-diversified portfolio of renewable energy assets spread across the globe.

Excluding dividends, shares of Brookfield Renewable Partners are down close to 40% since the beginning of 2021. Even so, the growth stock’s nearly 50% return over the past five years has been good enough to outperform the S&P/TSX Composite Index.

Value, growth, and passive income: What is there not to like?

In addition to a discounted price and long-term growth potential, Brookfield Renewable Partners can also be a meaningful passive-income generator.

With the stock’s recent pullback, the dividend yield has surged to 5%.

As the growth stock eventually returns to its market-beating ways, the yield will naturally decline. But for the time being, a 5% dividend yield alone is enough of a reason to have this growth stock on your radar.

Foolish bottom line

The renewable energy space has had its challenges over the past several years, but it’s hard not to be optimistic about the long-term opportunities in the space. Demand for green energy computation is only expected to continue growing, which is why now could be an incredibly opportunistic time to invest.

With Brookfield Renewable Partners’s global position, it’s an excellent choice for anyone new to renewable energy investing. The company can provide instant, well-diversified exposure to the sector.

Don’t miss your chance to load up on one of the top renewable energy stocks around. You’ll be hard-pressed to find another 5%-yielding dividend stock on the TSX with a market-beating track record like that of Brookfield Renewable Partners.