Clearway Energy Receives Analyst Upgrade on Strategic Expansion

Wall Street analysts have increased their price target for Clearway Energy, reflecting growing confidence in the renewable power producer's financial roadmap. The new target of $37.50 per share suggests an approximate 18% upside from recent trading levels, driven by strategic acquisitions and reaffirmed cash flow guidance.

Supporting the optimistic outlook, Clearway's board has declared a quarterly dividend of $0.4528 per share, marking a 5.0% increase from the prior payout. This raise aligns with the company's publicly stated goal of delivering annual dividend growth between 5% and 8%, resulting in a forward yield near 5.7%. Management has reiterated its commitment to achieving a Cash Available for Distribution (CAFD) target of $2.90 to $3.10 per share by 2030.

Acquisition Fuels Portfolio and Cash Flow Growth

A key driver behind the revised valuation is Clearway's binding agreement to acquire a 613-megawatt solar portfolio from Deriva Energy. The transaction, valued between $210 million and $230 million, is slated for completion in the second quarter of 2026. This purchase is expected to immediately contribute to CAFD upon closing and to add an average of $27 million in annual CAFD from 2027 onward.

Should investors sell immediately? Or is it worth buying Clearway Energy?

This strategic addition will expand Clearway's total operational portfolio to roughly 12.7 gigawatts. The asset mix comprises 9.9 gigawatts of wind, solar, and storage capacity, complemented by 2.8 gigawatts of dispatchable natural gas generation. This diversified structure is viewed as a critical advantage for maintaining grid reliability in key markets like PJM and California.

Favorable Market Dynamics and Strategic Positioning

The company's strategic importance is amplified by rising demand for reliable power to support data centers and AI infrastructure. In this environment, dispatchable capacity, such as Clearway's 2.8-gigawatt gas fleet, is considered essential for grid stability. Market conditions in core regions have tightened significantly, pushing capacity auction prices to record levels. Clearway's hybrid model of renewable and controllable generation positions it to capitalize on this trend effectively.

Market experts maintain a "Buy" recommendation on the shares, suggesting that the long-term value of the expanded solar portfolio may not yet be fully reflected in the stock price. The finalization of the Deriva Energy deal in Q2 2026 is seen as the next major milestone for the company.