3 Solar Stocks To Buy On Trump Tariff

Shares of U.S. solar energy stocks climbed on Tuesday after President Donald Trump approved a new tariff on imported solar cells and modules.

U.S. Trade Representative Robert Lighthizer announced on Monday that Trump approved their recommendations for a tariff imposed on solar technology imports. The move comes after months of speculation regarding the possible solar tariff as Trump looks to combat what he and others view as unfair pricing from foreign solar producers, especially in China. 

The USTR will impose a new 30% tariff on solar panel components, with the rates declining incrementally to 15% by the fourth year. The first 2.5 gigawatts of imported solar cells are exempt from these tariffs during the agreement.

“These cases were filed by American businesses and thoroughly litigated at the International Trade Commission over a period of several months,” Lighthizer said in a statement. “The ITC found that U.S. producers had been seriously injured by imports and made several recommendations to the President.”

The full outline of the planned tariff, which also includes imported large residential washing machines, specifically points to China’s 2017 proclamations that it hopes to increase its current solar production capacity to about 70% of the global total.

Following the announcement, investors began to search for U.S. solar stocks that stand to gain in the wake of Trump’s new tariff.

Aside from electric car power Tesla (TSLA - Free Report), which could see gains from this tariff as it increases domestic manufacturing for its solar panel business, three U.S. solar energy companies might also experience gains.

First Solar, Inc. (FSLR - Free Report)

One of the companies that could benefit the most is First Solar, which is also currently a Zacks Rank #2 (Buy). The Tempe, Arizona-based firm manufactures some of its solar panels in the U.S. On top that, First Solar’s thin-film panels could possibly be exempt from the new tariffs.

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