The clean technology industry (including recycling, renewable energy, information technology,
green transportation, electric motors, green chemistry, lighting, etc) has been one of the fastest
growing sectors, and billions of dollars have been poured into the industry from investors and
governments worldwide. Having been through two boom-bust cycles in the 21st century alone,
many investors are worried whether the industry is worth the investment. The concern mainly
comes from overheated investment into the industry and investors’ overly high expectations.
This study will compare the clean technology industry with the dot-com industry in 2000, and
perform an industry valuation analysis and then compare the result with the current investment
level. By building a discounted cash flow model of selected companies in the solar photovoltaic
(PV) sector, the equity value is calculated and compared with the current market cap of the
company set. In addition, this thesis will see what assumptions have to be met for the current
investment level, and whether those assumptions are realizable.