Guinness Global Investors recently released its “Guinness Sustainable Energy Fund” Q3 2026 investor letter. A copy of the letter can be downloaded here. The fund faced a challenging third-quarter 2026 investment environment as rising interest rates, persistent inflation, and a rotation away from growth stocks weighed on renewable-energy and electrification shares. The Fund declined 8.1% during the quarter, underperforming the MSCI World Index, which gained 1.9%, as higher Treasury yields pressured interest-rate-sensitive industrial and utility holdings and an AI-related sell-off affected electrical equipment and semiconductor investments. Despite the quarterly weakness, the managers believe the sector’s long-term fundamentals remain attractive: wind and solar electricity costs have declined substantially, more than 90% of utility-scale renewable projects commissioned in 2025 were cheaper than the lowest-cost fossil-fuel alternative, and the Fund’s expected annual earnings growth over the next three years increased to around 17%. Looking ahead, Guinness remains constructive on renewable generation, grid investment, energy storage, and electrification, arguing that the Fund’s forward price-to-earnings multiple fell from 18.7 times at the end of June to 16.4 times at the end of September even as expected earnings growth improved, creating a more attractive valuation opportunity for investors seeking exposure to the energy transition. In addition, please check the Fund’s top five holdings to know its best picks in 2026.
In its third-quarter 2026 investor letter, Guinness Sustainable Energy Fund highlighted stocks like NextEra Energy, Inc. (NYSE:NEE). NextEra Energy, Inc. (NYSE:NEE) is an electric utility and clean energy company with operations spanning regulated electricity services and renewable energy generation. Its portfolio gives it exposure to electricity demand growth, grid investment, and renewable power development. The one-month return of NextEra Energy, Inc. (NYSE:NEE) was -3.28% while its shares traded between $74.41 and $98.75 over the last 52 weeks. On October 14, 2026, NextEra Energy, Inc. (NYSE:NEE) stock closed at approximately $78.37 per share, with a market capitalization of about $164.01 billion.
Guinness Sustainable Energy Fund stated the following regarding NextEra Energy, Inc. (NYSE:NEE) in its Q3 2026 investor letter:
“Within utilities & IPPs, US-exposed names were caught up in the AI sell-off and underperformed their international counterparts. Ormat fell 15.9% as investors questioned the sustainability of its storage revenue under a slower data centre build-out, and NextEra fell 13.7% as it seeks a regulatory path for its $67bn acquisition of Dominion Energy.”
NextEra Energy (NEE) Faces Uncertainty Over Its Proposed $67 Billion Acquisition
Suwin/Shutterstock.com
NextEra Energy, Inc. (NYSE:NEE) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. As per our database, 80 hedge fund portfolio held NextEra Energy, Inc. (NYSE:NEE) at the end of the second quarter, compared with 74 in the previous quarter. While we acknowledge the risk and potential of NextEra Energy, Inc. (NYSE:NEE) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns within a shorter time frame. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
In another article, we covered NextEra Energy, Inc. (NYSE:NEE) and discussed why the company is cheaper than past. In addition, please check out our hedge fund investor letters Q3 2026 page for more investor letters from hedge funds and other leading investors.
READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years
This article is originally published at Insider Monkey.
Source: finance.yahoo.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.
