Rain or sunshine for ASX renewable shares in the March quarter?

There is hardly a dull moment in the world of ASX-listed renewable energy shares. Given how topical the green transition is these days, attention-grabbing headlines are landing frequently. The March 2022 quarter was no different.

A notable item for energy-conscious investors was the release of Clean Energy Australia’s 2022 report. This showed Australia achieved a new record for its portion of electricity generated by renewables in 2021 at 32.5%.

However, renewable energy advocates were disheartened by the latest federal budget. According to the document, climate spending will tumble 35% over the next four years under the current government.

So, how did it all pan out for ASX renewable shares in the March quarter?

ASX renewable shares present a mixed bag of results

Two companies running on low charge

As with any sector over a three-month period, there are usually winners and losers. Unfortunately for Genex Power Ltd (ASX: GNX) and Mercury NZ Ltd (ASX: MCY), both companies found themselves in the negative return bucket.

Firstly, renewable energy project developer Genex Power suffered a significant fall during the quarter. By the end of March, Genex shares were 27.5% lower than at the beginning of the year. Investors appeared unimpressed by the company’s first-half results as it posted a net loss after tax of $4.41 million. However, revenue increased 51% to $11.96 million during the period.

Secondly, Mercury experienced a 2.8% reduction in its share price by the end of the March quarter. The ASX-listed renewable share also unleashed its half-year results in February. Though, the numbers didn’t instil much confidence in shareholders. For instance, revenue fell 7.5% compared to the prior corresponding period to $873 million. Likewise, underlying earnings after tax dropped 13% to $20 million.

What about the green winners of the March quarter?

It wasn’t all doom and gloom for ASX renewable shares during the recent quarter. On the other side of the fence, Meridian Energy Ltd (ASX: MEZ) managed to gain 4.1%. Yet another New Zealand-based ASX-listed electricity generator, Meridian secured a positive return despite posting a 36% fall in its net profit after tax (NPAT).

Lastly, to find a quarterly return greater than 5% we need to relax the definition of an ASX renewable share. Including companies that produce some of their electricity via renewable assets, as opposed to the majority, we unlock one ASX share that served up a gain of 25.7% during the period.

The company is AGL Energy Limited (ASX: AGL) and it has wowed investors as its share price has continued to strengthen since the beginning of 2022.

Already this year, AGL has rejected two takeover bids from entrepreneur Mike Cannon-Brookes and Brookfield Asset Management. The energy company’s board has held firm that it believes it is worth more than $8.25 per share.

The post Rain or sunshine for ASX renewable shares in the March quarter? appeared first on The Motley Fool Australia.

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Motley Fool contributor Mitchell Lawler owns Genex Power Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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