Investing in solar stocks can be a volatile bet, but the industry has come up with a new investment more risk averse investors should keep an eye on. It's known as the yieldco, and it's a company that owns solar projects and pays investors a regular dividend yield with the regular cash flow those projects create.
NRG Energy has already created NRG Yield (NYSE:NYLD), the first publicly traded yieldco, but that won't be the end. SunEdison (NASDAQOTH:SUNEQ) is expected to launch a yieldco this year, and SunPower (NASDAQ:SPWR) recently announced what it calls a holdco/yieldco strategy.
In the following video, solar specialist Travis Hoium covers more on how these yieldco products will be rolled out and why income investors should be excited about their potential.
Top dividend stocks for the next decade
These dividend stocks are a great new opportunity in energy, and the smartest investors know that dividend stocks simply crush their non-dividend-paying counterparts over the long term. That's beyond dispute. A well-constructed dividend portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts put together a report on a group of high-yielding stocks that should be in any income investor's portfolio. To see our free report on these stocks, just click here now.
Travis Hoium manages an account that owns shares of NRG Yield and SunPower, and he is personally long shares of SunPower and options. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.