Fluence Energy could be a winner in the renewable energy transition, according to Barclays. Analyst Christine Cho initiated the stock with an overweight rating. Her $31 price target suggests 18.9% upside from where shares closed on Tuesday. The stock has gained more than 50% year to date. Fluence Energy provides “energy storage technology solutions, delivering hardware along with advanced tech/AI-powered services to optimize the storage assets – either from a revenue-generating perspective and/or an O & M standpoint,” Cho said in a Wednesday note. “Given the rapid expected buildout of renewables and the intermittency issues inherent in wind and solar projects, energy storage will be a key piece in the energy transition.” The firm expects Fluence Energy to increase its revenue at a 46% compound annual growth rate from 2022 to 2025, which is double the firm’s expectations for utility-scale solar companies. Cho also expects the company to become profitable some time in the latter half of 2024. “Gross margins are expected to continue its upward trajectory, especially as legacy lower-margin bookings roll off through 1H24 for FLNC,” the analyst said. “We also expect FLNC’s Services business to grow at a rapid pace at attractive margins.” According to the note, the energy storage is at an earlier part of the transition cycle than wind and solar partly because costs for batteries have historically been high and raw materials are in short supply. But, with most of these issues having been alleviated, Cho expects costs to continue decreasing and Fluence to grow its top line at a faster rate than utility-scale solar names. Cho also initiated energy storage network provider Stem with an equal weight rating and $6 price target, which implies a 10.3% upside from Tuesday’s close. Shares of the company have declined more than 39% in 2023, with a substantial amount of those losses from this month. —CNBC’s Michael Bloom contributed to this report.