Oppenheimer Lists Top Power Technology Stocks Amid Rising Costs, Policy Shifts

Investing.com -- Power technology stocks face a complex environment shaped by surging demand, tight labor markets, elevated interest rates, and evolving policy frameworks, according to Oppenheimer. The broker identifies selective opportunities in companies with exposure to power management and labor-saving solutions as the sector navigates mixed third-quarter 2026 results and fourth-quarter guidance.

U.S. wholesale power prices remained sharply elevated year-over-year in PJM Interconnection, up 42%, and SPP, up 23%, despite mid-single-digit declines in natural gas prices. Markets with higher renewables penetration showed more modest movement, with CAISO up 5% and ERCOT down 9%.

Residential power costs increased 4% year-over-year through August, outpacing the broader Consumer Price Index growth of 3.2%. European Union average prices rose 3.3% year-over-year through August, while wholesale prices in Germany, Italy, and Spain surged over 50%.

Construction labor costs continue climbing, with wage growth accelerating to 4.4% year-over-year, outpacing broader wage gains of 3.7%. Electrical and powerline workers saw even sharper increases of 7.3% and 7.7% respectively in July. Tight construction labor for power projects, driven by data center demand, appears to be constraining renewables growth.

Oppenheimer highlights four top picks in the sector:

1. GE Vernova - The firm points to potential pricing power benefits from Executive Order 14420, which bans bulk power equipment imports from China. This policy shift favors domestic manufacturers positioned to capture market share as companies navigate supply chain realignments.

2. American Superconductor - Also expected to gain pricing power from the China equipment import ban under Executive Order 14420. The company stands to benefit from the policy environment driving share toward domestic manufacturing capabilities.

3. Shoals Technologies - Identified as a key provider of in-field labor efficiency solutions. With electrical worker wages rising 7.3% year-over-year, the company’s labor-saving technologies address a critical pain point for power project developers facing tight construction labor markets.

4. Ormat Technologies - Rounds out Oppenheimer’s top picks as the sector contends with demand growth driving material price increases for both utility-scale and distributed power projects.

Attention now turns to proposed Senate legislation curbing federal permitting litigation, with a vote targeted during the lame duck period.

Original Article

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