NextEnergy Solar Fund Ltd NESF

This investment company focuses on the acquisition of solar energy assets, with a particular focus on the UK.

2 Likes

Is this considered to be a SPAC?

No. This is a really good, long-standing renewable energy fund. They basically buy up operational solar farms when the development risk is past and then pocket the revenue for the next 25 years sharing the profits with investors as a 5-6% dividend yield paid quarterly. I’ve been in this stock for years and see it as a low risk, reliable dividend option to offset the riskier growth stocks I hold. Nothing to do with SPACS in any way.

2 Likes

At the same time a lot of my green energy stocks are going red this one seems to be staying steady and in fact putting on a bit of growth.
Possibly the comment above goes some way to explaining this as it suggests NextEnergy do well from others (such as foresight solar) going into decline

Yes you need to understand the concept of Net Asset Value (NAV) for stocks like this one. The idea is that the fund holds it’s NAV steady by efficiently recycling its capital, adding to the portfolio of solar farms and optimising performance to offset depreciation. Investors then receive a quarterly dividend that increases with inflation. You should not expect any growth in the share price at all. If it does that’s a bonus. Foresight solar works in exactly the same way. They have had a few problems with projects in Australia which has affected their NAV but if you are able to leave your money in for a few years, the dividend should more than make up for any modest drop in the share price. These are not high return stocks though. You should be looking for stable share price that tends to move up or down by no more than 10% and consistently pays its dividend of 5-6% each year. Greencoat Wind, TRIG and the Octopus renewables fund are other examples.

1 Like