The recent sell-off in clean tech is a good buying opportunity, according to Morgan Stanley. The stocks are down more than 30% since their peak levels in September and a number are near or below their pre- Inflation Reduction Act levels, the firm said. The bill was signed into law in August and put $369 billion behind efforts to fight climate change and bolster U.S. energy security. Clean tech stocks bounced after the IRA, but then reversed as part of broader risk-off sentiment, renewed interest rate sensitivity and a rotation from high-growth and unprofitable tech stocks, analyst Stephen Byrd wrote in a note Friday. "The recent move in clean tech stocks is overblown and doesn't reflect fundamental changes in the outlook for clean energy," Byrd said. "We expect the IRA will drive significant demand for clean energy technologies and accelerate clean hydrogen growth in the US — this view has not changed over the last two months despite the clean tech selloff." Morgan Stanley's highest conviction stocks are Plug Power and Sunrun , the latter of which the firm believes could triple. It has a $79 price target on the stock, which implies 244% upside from Thursday's close. Solar energy company Sunrun is a "significant" IRA winner, but has given up most of the gains it made on the legislation, Byrd pointed out. The stock is down more than 30% year to date and is underperforming its peers by 14%, he said. "We expect continued strong demand for residential solar given a widening 'economic' wedge between the cost of solar and utility rates across the US, aided by an extension of the solar [investment tax credit] through the early 2030s and various ITC 'boosters' available to RUN," he wrote. Concerns about the impact of interest rates on the company has contributed to the sell-off, Byrd said, but he believes the company can manage through it by raising prices and still maintain a strong value proposition for customers. The biggest IRA beneficiary is hydrogen fuel cell maker Plug Power, Byrd said. The company has several catalysts on the horizon, including an expected announcement of at least one large customer and a potential partnership in or progress on its on-road vehicle business. The stock has given up a significant portion of its IRA gains and is down 35% from its post-IRA peak, according to Morgan Stanley. The firm believes it can rally another 176% from Thursday's close. — CNBC's Michael Bloom contributed reporting.