As investors turn to dividend stocks for stability amidst a tariffs-driven selloff in the broader market, Clearway Energy (CWEN) stands out with its impressive 6.4% dividend yield, making it an appealing option for those seeking steady returns in a tariff-proof sector. 

The company’s focus on clean energy aligns perfectly with global trends, as renewables are expected to make up over one-third of global electricity generation this year, surpassing coal for the first time. 

Solar energy alone is projected to drive nearly half of the growth in electricity demand through 2027, and Clearway’s investments in wind, solar, and battery storage position it to benefit from these shifts.

With a solid business model and a focus on sustainability, Clearway Energy offers not just high yields, but also the opportunity to invest in a company aligned with the future of energy. Let’s dive deeper into its financial performance, growth drivers, and why analysts believe it’s a smart buy for 2025.

Clearway Energy’s Financial Strength

Clearway Energy (CWEN) runs a mix of wind, solar, and energy storage projects across the U.S., focusing on clean energy while securing steady income through long-term power purchase agreements. 

Over the past year, Clearway’s stock price has risen by 13.5%, and it’s up 4.4% year-to-date, showing solid performance despite market ups and downs. 

Financially, Clearway reported mixed results for 2024. The company posted a net loss of $63 million for the year (wider than in 2023) and $48 million for Q4 (narrower than 2023). Its adjusted EBITDA rose to $1.15 billion, an improvement from $1.06 billion in 2023, driven by growth investments and enhanced renewable production. 

Cash from operating activities reached $770 million, and cash available for distribution (CAFD) increased to $425 million from $342 million in the previous year. These figures highlight Clearway’s ability to generate substantial cash flow despite challenges. 

Clearway’s valuation metrics reflect its growth focus. Its trailing price-earnings ratio of 37.4x is notably higher than the utilities sector average of 17.62x, signaling high investor expectations for future earnings growth. 

At the same time, its price-book ratio of 1.66x suggests that the stock is reasonably priced relative to its assets. By concentrating on domestic renewable energy production, Clearway also avoids risks tied to international trade policies, reinforcing its reputation as a tariff-proof investment option for 2025 and beyond.

What Fuels Clearway Energy’s Growth?

Clearway Energy’s growth comes from its focus on expanding renewable energy projects and improving efficiency. Recently, the company made big moves by partnering with Clearway Group to invest in a 320 MW storage hybridization portfolio and repower 335 MW of wind capacity, ensuring its projects remain modern and efficient. 

It also signed a deal to acquire a 137 MW wind project, further strengthening its presence in wind energy. These steps not only increase Clearway’s renewable energy capacity, but also position it to benefit from the growing demand for clean energy as the world shifts away from fossil fuels. 

What makes Clearway even more attractive is its commitment to rewarding shareholders. The company recently raised its quarterly dividend by 1.7% to $0.4312 per share, or $1.7248 annually, marking two years of consecutive dividend growth. 

With a dividend yield of 6.4%, Clearway stands well above the utilities sector average of 3.75%. While its forward payout ratio of 153.69% might seem high, it reflects the company’s ability to fund dividends through strong cash flows rather than net income, a common approach for infrastructure-heavy businesses.

Why Analysts Are Bullish on Clearway Energy

Clearway Energy’s 2025 guidance has been a big reason for analysts’ confidence. The company expects its CAFD to land between $400 million and $440 million, with a midpoint of $420 million. This steady projection reflects the strength of its renewable energy portfolio and recent investments. 

Management is also optimistic about hitting long-term goals, including a CAFD per share of $2.40 to $2.60 by 2027, which shows Clearway’s ability to generate consistent cash flow to support growth and dividends.

Analysts are clearly on board with this outlook. 13 analysts covering the stock have given it a consensus “Strong Buy” rating, showing optimism about its future. The average price target is $35.31, suggesting about 30% upside from current levels. 

Conclusion

Clearway Energy combines the stability of a high-yield dividend with the growth potential of renewable energy investments, making it a standout in today’s market. With robust financial guidance, strategic expansions, and unwavering analyst support, the company is well-positioned to thrive in 2025 and beyond. For investors seeking a tariff-proof stock that delivers consistent returns while riding the clean energy wave, Clearway Energy might just be the perfect fit.