Bank of America has identified a group of U.S. cleantech companies it favors as solar power maintains a cost edge over newly built gas-fired generation even without subsidies. The bank draws on Rystad Energy analysis to underline the economics behind the call and provides company-specific price targets and downside risks for five names in the space.
Rystad Energy data cited by the bank shows unsubsidized utility-scale solar costs in the range of $50 to $70 per megawatt-hour, which the research note says remains lower than new-build combined-cycle gas turbine costs of $80 to $100 per megawatt-hour. The bank attributes part of this gap to roughly seven-year turbine lead times and inflation in gas-side engineering, procurement and construction costs.
Beyond pure generation costs, Bank of America highlights broader market dynamics that are reshaping the developer landscape. Tightening tax equity financing markets and elevated geopolitical risk, the bank says, are widening the gulf between top-tier developers and smaller players. These pressures are expected to create consolidation incentives across the sector over the next 18 to 24 months.
Nextpower
The bank assigns a $121 price objective for Nextpower, using a blended valuation framework that includes enterprise value to EBITDA, discounted cash flow and price-to-earnings analyses. Bank of America applies a four-times premium to solar peers in valuing Nextpower, reflecting the company’s industrial-like business model and what the bank describes as best-in-class execution.
Key downside scenarios called out for Nextpower include the risk of weak execution as the company enters new verticals, headwinds in the core U.S. utility-scale solar market, and a more inflationary environment across the supply chain. The bank notes that Nextpower recently reported third-quarter 2026 earnings and revenue that beat analyst expectations.
First Solar
Bank of America’s price objective for First Solar is $257 per share, generated using a discounted cash flow model and peer multiple analysis. The bank values the company’s 45X tax credits through 2032 on a net present value basis, which it says contributes an incremental $96 per share to its valuation.
Downside risks detailed by the bank include a pricing environment that deteriorates, unfavorable trade policy shifts, and the potential repeal of 45X tax credits. The note also records that First Solar reported fourth-quarter results that missed expectations and issued 2026 revenue guidance below projections, developments that have led to downgrades from some sell-side firms.
Shoals Technologies Group
The bank sets an $11 price objective for Shoals Technologies using a 50/50 blend of enterprise value to EBITDA and discounted cash flow approaches, while applying a one-times discount to the peer group multiple. The bank warns of downside from project timing disruption amid uncertainty around the Inflation Reduction Act and from increased competition in the market.
Shoals reported fourth-quarter 2025 adjusted EBITDA that came in 19% below consensus, and the note says that certain firms have reduced price targets amid margin pressure concerns.
HA Sustainable Infrastructure Capital (HASI)
Bank of America places a $42 per share objective on HA Sustainable Infrastructure Capital, relying on a blended valuation that includes a dividend discount model, discounted cash flow and price-to-earnings metrics. Potential downside scenarios include origination growth falling short of expectations and changes in trade policy that delay project development timelines.
The company recently announced the issuance of new green notes and the redemption of all $450 million of its outstanding 8.000% senior notes due 2027. The bank also notes that following the company’s fourth-quarter 2025 results, at least one firm raised its price target.
Clearway Energy
Bank of America reiterated a Buy rating on Clearway Energy with a $38 price objective, describing the company as having one of the clearest multi-year growth pathways in the cleantech sector. The bank’s model for Clearway is anchored on sponsor-backed drop-down transactions and a repowering pipeline that the note links increasingly to demand from hyperscale cloud customers.
Clearway reported robust fourth-quarter 2025 financial results, with Cash Available for Distribution above guidance. Those results prompted some sell-side firms to raise price targets.
Across the five companies, Bank of America combines valuation frameworks and company-specific considerations to arrive at its price objectives, while also enumerating specific downside risks that could pressure performance. The research note stresses that financing conditions, supply-chain inflation and policy uncertainty remain salient factors for the sector as a whole.