Finding the best solar stock picks to outperform the market in 2024 will require careful consideration. However, a few needle-in-the-hystack companies stand out among their competitors. 

The clean energy economy has been in a major slump for the past 12-18 months due to the advent of inflation and higher interest rates. These two factors have weakened demand as a slowdown in construction activity persists. However, the solar industry still has small pockets of growth led by a few industry players that operate at peak scale and efficiency. With the solar industry poised for significant expansion over the next several decades, these companies are well-positioned to outperform. 

Now, let’s unpack the top 3 solar stock picks to outperform the market in 2024 and beyond.

First Solar (FSLR)

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First Solar (NASDAQ:FSLR) stands out as a leader in solar panel manufacturing with a vertically integrated business model. Despite the slowdown in the solar and energy storage markets, the company delivered record results in the 2023 fiscal year.

First Solar saw a major turnaround in the business in 2023, and management has remained confident in their ability to build on the momentum. Their robust financial profile and significant growth potential driven by domestic and international markets make them well-positioned for expansion. They have already committed $1.1 billion to build their fifth manufacturing facility in the U.S. and plan to reach 25 GW generating capacity by 2026.

Furthermore, their proprietary thin-film photovoltaic panels offer significant advantages for efficiency and cost-competitiveness, especially in large scale utility projects. With operating income projected to nearly double, First Solar stands out as one of the top solar stock picks for 2024.

NextEra Energy (NEE)

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NextEra Energy (NYSE:NEE) is a true powerhouse in the renewable energy sector and a significant player in solar power generation. Through its subsidiaries, FPL and NextEra Energy Resources, the company is a leading solar project developer and operator. 

NextEra’s immense scale, operational expertise and diversified energy portfolio offer investors tremendous long-term growth potential. One of the key factors driving NextEra’s appeal as one of the best solar stock picks is its impressive track record of consistent growth. They have continuously grown their generating capacity over the last decade and show no signs of slowing down.

Moreover, EPS skyrocketed 71% to $3.60 per share while growing their backlog for new solar and energy storage projects. In Q1 FY24, their subsidiary, FPL, initiated its 10-year plan calling for 21 GW of solar and storage capacity. It expects total solar capacity to increase from 6% to 38% of total generation by 2033. This shows a true commitment to solar energy, and their planned 10% dividend growth through 2026 provides another compelling reason to pounce on shares.

Vistra (VST)

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For immediate solar stock picks, Vistra (NYSE:VST) may not seem obvioys. However, Vistra is making strategic moves toward decarbonization that could propel its growth in 2024. 

Vistra has ambitious plans to shutter coal-fired power plants and invest heavily in renewable energy, predominately solar and energy storage. Their plans are already in motion, and the acquisition of Energy Harbour brings their installed generating capacity to more than 41,000 megawatts. This positions the company well to capitalize on the global economy’s transition to renewable energy, with strategic positioning in the United States.

The company’s flip to profitability in 2023 can lay the foundation for accelerated growth in 2024. Additionally, the company’s strong track record of execution and strong project management skills further instill confidence in shareholders. As demand for clean energy surges and traditional fossil fuel assets become less profitable, Vistra’s repositioning toward solar and energy storage presents a long term opportunity with potential upside.

On the date of publication, Terel Miles did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.