Clearway Energy (CWEN.A) has seen its stock gain 9% over the past month, attracting attention from investors looking for steady growth in renewables. The company's performance stands out when compared to broader utility sector trends.

Clearway Energy’s 8.6% 1-month share price return builds on its strong year-to-date rally, with the stock now up 18% so far in 2024. Momentum appears to be building again, and with a 1-year total shareholder return just over 20%, investors are seeing clear signals of renewed optimism following a period of slower growth earlier this year.

If you’re looking to see what else is gaining traction outside of utilities, now might be the perfect time to discover fast growing stocks with high insider ownership

But with Clearway Energy’s steady run and some analysts still seeing a discount to fair value, the real question is whether today’s prices leave room for more upside or if future growth is already factored in.

Most Popular Narrative: 18.8% Undervalued

Clearway Energy closed at $29.31, while the most widely followed narrative estimates fair value at $36.11. This suggests a notable upside potential. Investor attention is focused on the pipeline of projects and future earnings power, with expectations running high amid a bullish consensus.

The company's diversified asset base across wind, solar, and storage in multiple core U.S. markets, along with continued investment in grid-relevant battery projects, reduces exposure to regional volatility and supports steady net margin expansion as grid modernization deepens.

Want to know what’s driving this bullish outlook? The calculations hinge on future margin expansion, long-term contracts, and a transformation in cash flow growth. Curious which aggressive growth assumptions deliver that target price? Discover the financial forecasts behind the optimism by exploring the full narrative.

Result: Fair Value of $36.11 (UNDERVALUED)

However, rising interest rates or unexpected policy changes could lead to higher costs and reduced earnings, which could challenge the positive growth outlook for Clearway Energy.

Build Your Own Clearway Energy Narrative

If you have a different perspective or want to dig deeper into the numbers, you can easily craft your personal view of the story. Do it your way

A great starting point for your Clearway Energy research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.