These stocks could thrive under Biden: Procter & Gamble, Trane Technologies, AvalonBay Communities, Rockwell Automation, Acuity Brands, Osram Licht, Hubbell, Schneider Electric, Ameresco, NXP Semiconductors, ON Semiconductor, Avangrid, Eaton, Ormat Technologies, NextEra Energy, TPI Composites, Orsted, Trimble, Koninklijke DSM, and Agilent Technologies. So writes Michael Brush who interviews leading ESG fund managers. There’s more too
Transcript & Links, Episode 38, August 14, 2020
Hello, Ron Robins here. Welcome to podcast episode 38 published on August 14 titled “These Stocks Could Thrive Under Biden. More…“— and presented by Investing for the Soul. investingforthesoul.com is your site for vital global ethical and sustainable investing news, commentary, information, and resources.
Remember that you can find a full transcript, links to content – including stock symbols and bonus material – at this episode’s podcast page located at investingforthesoul.com/podcasts.
And Google any terms that are unfamiliar to you.
1) These Stocks Could Thrive Under Biden. More…
Now with the US political season heating up, MarketWatch published an article titled These ‘green’ stocks would thrive under a Biden administration, according to fund managers. It’s written by Michael Brush.
Below, I’m quoting Mr. Brush at length.
Quote. “It’s increasingly likely that the Democrats will win the White House and the Senate. For investors, that means it’s time to review the environmental, social and governance (ESG) sector, with an emphasis on ‘green’ stocks that might do well under a Joe Biden presidency.
For key insights and stock ideas, I (that is Michael Brush) recently spoke with three ESG fund managers with outperforming records, according to Morningstar, and a policy analyst from one of the companies.
Highlights of the Biden plan
First, Biden’s plan is ambitious. He wants a carbon-neutral power-generation sector by 2035…
‘Everything he is doing aligns with the strategy that we as ESG investors have been arguing for, for years,’ says Cheryl Smith, who manages the John Hancock ESG Large Cap Core Fund JHJRX, +0.25%. The fund beats its Morningstar large-cap blend benchmark by three percentage points, annualized, over the past three years…
‘I think it’s great to have all these plans. The difficulty is executing them,’ says Hubert Aarts of the Pax Global Environmental Markets Fund PGINX, +0.11%… Aarts is worth listening to because his fund outperforms its world large-cap stock category by 6.6 percentage points over the past year, says Morningstar.
Fuel for Investing Smarter
‘The energy transformation is a transition which will happen with or without politicians,’ says Jonathan Waghorn of the Guinness Atkinson Alternative Energy Fund GAAEX, -0.46%. His fund beats its small- and mid-cap value sector benchmark by 34 percentage points over the past year, and 13.6 percentage points annualized over the past three years, according to Morningstar.
It can be tricky to wrangle with investing in environmentally friendly stocks, because there’s no clear sector labeled ‘alternative’ or ‘clean’ energy, says Waghorn.
Smith, at the John Hancock ESG Large Cap Core Fund, includes companies with good internal eco-friendly policies, to broaden the playing field. This extends her reach into even consumer staples like Procter & Gamble PG, -0.25%, which she says is taking significant steps to become carbon neutral and reduce greenhouse gas emissions.
1. Green buildings
Making buildings more energy efficient is the ‘low-hanging fruit’ of green initiatives because there is so much companies can do to reduce energy consumption in their buildings.
Smith… likes Trane Technologies TT, 1.84%, which offers energy-efficient climate-control systems, and the real estate investment trust AvalonBay Communities AVB, -0.27%, which specializes in energy-efficient buildings.
She cites Rockwell Automation ROK, 2.30%, which has a division that helps companies monitor energy usage and waste.
Aarts… singles out Acuity Brands AYI, 3.00%, Osram Licht OSAGY, -3.14% and Hubbell HUBB, 0.81% in energy-efficient lighting, and Schneider Electric SBGSY, 1.45%, which sells products that help companies improve energy efficiency.
Waghorn… points us to Ameresco AMRC, 0.16%, which helps companies improve energy and lighting efficiency.
2. Green autos
But it makes sense to still consider some of the ‘arms dealers’ to the green car space. Here, Smith likes NXP Semiconductors NXPI, 1.75%, which sells semiconductors used in electric-powered vehicles. Waghorn likes Samsung SDI, a Korean pureplay on lithium-ion batteries that is building partnerships with European car manufacturers. Another play here that he likes: ON Semiconductor ON, 3.01%, which sells power-management chips used in the electric-vehicle space.
3. Renewable-energy companies
In this area, Smith… singles out Avangrid AGR, 0.39%, a major supplier of power generated from offshore wind sources. She also highlights Eaton ETN, 3.47%, which sells gear that helps improve efficiency of the power grid so it can better handle power from alternative-energy sources.
Waghorn owns Ormat Technologies ORA, 0.67%, a geothermal power generator, NextEra Energy NEE, -1.69%, the largest generator of renewable energy, and TPI Composites TPIC, -4.01%, a materials-science company that sells lightweight materials used in wind turbine blades.
Aarts highlights Orsted DNNGY, +1.34%, a green-energy provider based in Denmark.
In this space, Aarts… likes Trimble TRMB, 0.91%, because it offers satellite images used by farmers to reduce waste of pesticides and water… He also cites Koninklijke DSM RDSMY, +0.05%, a Dutch company that sells ‘clean cow’ food that reduces the emission of methane from bovines.
He also says Agilent Technologies A, -0.18% will play a role in green farming because it sells gear used in testing levels of pollution in water, air and soil.” End quotes.
2) These Stocks Could Thrive Under Biden. More…
Three writers at The Motley have each chosen their top pick in a post titled 3 Top Renewable Energy Stocks to Buy in August.
Travis Hoium likes Bloom Energy. He writes, that, “Bloom Energy recently announced a solid oxide electrolyzer that will convert electricity and water into hydrogen fuel, which is usable in electricity-generating fuel cells. This could make hydrogen a viable fuel for shipping, long-haul trucking, and even grid applications. It’s even possible that hydrogen fuel could be pumped around the country using pipelines.
Bloom Energy isn’t yet profitable, but it has the chance to upend fossil fuel energy as we know it.” End quote.
Howard Smith suggests NextEra Energy. He says that “NextEra Energy is a Florida-based company that owns Florida Power & Light, the largest regulated electric utility in the U.S… as well as Gulf Power. Its other subsidiary is NextEra Energy Resources. This segment, along with its affiliates, is the world’s largest generator of wind and solar power, and invests in battery storage.
NextEra estimates it can provide investors an annual total return of 10% to 12% through 2022 with earnings growth and dividends, in large part due to growth in the renewables segment.” End quote.
Clean Energy Fuels Corp.
Jason Hall recommends Clean Energy Fuels Corp. Mr. Hall writes that, quote “Clean Energy Fuels hasn’t been a good investment over the past seven or eight years. Management made a leveraged bet that trucking would shift quickly from diesel to natural gas. But the bet backfired during the last oil collapse when growth slowed to a crawl…
Instead of focusing on those past mistakes, investors would do well to take a hard look at the company…
Here’s the major reason it’s a buy-now stock: For all the press that electric and hydrogen trucks get, renewable natural gas is the leader in zero-emissions fuels for trucking and is likely to remain so for years to come. Clean Energy Fuels is the dominant supplier of renewable natural gas.” End quote.
Worried About Investing Ethically? These 2 ETFs Can Put You On The Right Track.
From investing.com, there’s this article titled Worried About Investing Ethically? These 2 ETFs Can Put You On The Right Track. I’ll first mention the ETF and follow it with relevant quotes from the article.
1. The Vanguard ESG US Stock Fund (NYSE: ESGV)… seeks to track the performance of the FTSE US All Cap Choice index.
The fund is screened for certain ESG criteria and specifically excludes stocks of companies in: adult entertainment, alcohol, tobacco, weapons, fossil fuels, gambling and nuclear power. Additionally, stocks of individual companies that do not meet certain diversity criteria as well as the principles of the United Nations Global Compact are not included.
Year-to-date, the fund is up over 7%. On Aug. 5, it hit an all-time high of $61.08.
2. iShares MSCI Global Impact ETF (NASDAQ: SDG)… follows the MSCI ACWI Sustainable Impact index.
This benchmark index is composed of positive impact companies that derive a majority of their revenue from products and services that address at least one of the world’s major social or environmental challenges as identified by the United Nations Sustainable Development Goals, such as education or climate change.” End quotes.
Franklin Templeton Launches Muni Green Bond Fund.
Now I also thought that this might interest many ethical and sustainable investors. The article is titled Franklin Templeton Launches Muni Green Bond Fund. The article’s author is Emily Holbrook.
These are some of her remarks. Quote, “Franklin Templeton has launched the Franklin Municipal Green Bond Fund, one of the few strategies solely focusing on muni green bonds. The fund seeks to maximize income exempt from federal income taxes by investing in green bonds, including climate bonds, sustainability bonds, and environmental impact bonds…
Franklin Templeton said the municipal green bond market is young and continues to evolve… The universe of US municipal green bond issuers includes states, cities, municipal water and sewer enterprises, transportation systems, universities, and hospitals, among others.” End quotes.
Well, these are my top news stories and tips for this podcast: “These Stocks Could Thrive Under Biden. More…”
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Talk to you again on August 28. Bye for now.
© 2020 Ron Robins, Investing for the Soul.