Beat Inflation With These ESG Stocks, Analyst. Article titles covered include these: “Beat inflation with 3 stocks that bet against oil in favor of EVs and the renewable-power grid”; “Top 3 Energy Stocks for 2022 and Beyond”; “3 Best Corporate Governance Stocks to Buy Right Now”; and “1 Fund to Invest in a Sustainable Future”

PODCAST: Beat Inflation With These ESG Stocks, Analyst

Transcript & Links, Episode 76, February 11, 2022

Hello, Ron Robins here. Welcome to podcast episode 76 published on February 11, 2022, titled “Beat Inflation With These ESG Stocks, Analyst” — 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, quotes, and bonus material – at this episode’s podcast page located at investingforthesoul.com/podcasts.

Now, just a reminder. I do not evaluate any of the stocks or funds mentioned in this podcast. Furthermore, if you’re concerned about the ESG and sustainability ratings of any stock or fund included in this podcast, check your broker’s online site for such information.

If your broker doesn’t have this information, signup for free with Morningstar and you can gain access to company and fund ESG-sustainability ratings. Please note, I receive no compensation from Morningstar or anyone else covered in these podcasts.

Also, if any terms are unfamiliar to you, simply Google them.

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1. Beat Inflation With These ESG Stocks, Analyst

Now we’re hearing a lot about inflation. Take note of this article titled Beat inflation with 3 stocks that bet against oil in favor of EVs and the renewable-power grid. It’s by Rachel Koning Beals and found on MarketWatch.com. Here are some quotes.

“Ivana Delevska, founder and chief investment officer at SPEAR, which runs the actively managed SPEAR Alpha ETF (SPRX), already guides the fund toward disruptive industrial-technology stocks…

Now, she has her sights on what looks to be an inflation-tolerant trio of companies that can counter energy-price volatility.

1) Livent Corp. (LTHM)

It is ‘very advantageously positioned as a lithium manufacturer, which is expected to remain a key bottleneck component in the production of EVs…’

(It’s) shares are down nearly 8% so far in 2022, after a 13% gain in the past year.

2) ChargePoint Holdings (CHPT)

Delevska called it a diversified play on the theme because the company offers hardware and software to fleet, residential and commercial customers.

Among other factors, charging support got a boost in the bipartisan infrastructure legislation passed last year, but the most robust government request for funding to back EVs and their charging network has been hung up in a stalled Build Back Better bill.

3) Eaton Corp. (ETN)

The power-management company, which helps wind-turbine operators, for instance, convert power into electricity and transport it to the grid…

Shares are down 12% in the year to date, cutting into a nearly 25% one-year gain.” End quotes.

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2. Beat Inflation With These ESG Stocks?

Returning to familiar territory is an article by a regularly featured analyst Matthew DiLallo of The Motley Fool. Found on Nasdaq.com it’s titled Top 3 Energy Stocks for 2022 and Beyond. Here are some quotes from Mr. DiLallo.

“1) Brookfield Renewable (NYSE: BEPC) (NYSE: BEP)

It owns hydroelectric, wind, solar, and energy storage facilities across North and South America, Europe, and Asia…

Brookfield sells to utilities and large corporate customers under long-term, fixed-rate power purchase agreements (PPA)…

Brookfield distributes most of its cash flow to investors through a dividend that currently yields 3.7%…

In addition, Brookfield sees up to 9% of additional cash flow per share growth as it continues making value-enhancing acquisitions.

2) Enbridge (NYSE: ENB)

Enbridge is one of the largest energy infrastructure companies in North America…

Currently, fossil fuels supply the bulk of Enbridge’s income. However, the company has been slowly pivoting toward cleaner energy sources like natural gas and renewables over the years… Its legacy assets are generating cash that Enbridge is using to pay an attractive dividend – it currently yields 6.3% — and reinvest into cleaner energy infrastructure projects…

Meanwhile, it’s investing in emerging clean energy projects like hydrogen and carbon capture and storage.

3) NextEra Energy (NYSE: NEE)

It operates one of the cleanest electric utilities in the country, Florida Power & Light, and a leading energy production and infrastructure business, NextEra Energy Resources. Overall, it’s one of the world’s largest energy producers from the wind and sun. It’s also a leader in battery storage…

That should drive continued growth in NextEra’s 2%-yielding dividend. This year, it sees around 10% dividend growth, with future increases likely to track earnings growth.” End Quotes.

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3. Beat Inflation With These ESG Stocks?

Governance is the ‘G’ in ESG. That’s what this article is concerned with. It’s titled 3 Best Corporate Governance Stocks to Buy Right Now. It’s by Melissa Brock and seen on MarketBest.com. Here are some quotes from Ms. Brock on her picks.

“1) Alcoa Corp. (NYSE: AA)

Alcoa Corp… produces bauxite, alumina and aluminum products through bauxite mining operations which processes bauxite into alumina as well as smelting and casting operations to produce primary aluminum.

Alcoa expects all directors, officers and other employees to conduct business in compliance with a strict code of conduct and the company surveys compliance on an annual basis. The company carefully outlines the role of its board of directors and director responsibilities, including the core responsibilities to exercise business judgment and act in the best interests of the company and its stockholders…

In 2021 overall, the company posted the highest annual net income of $429 million and earnings per share of $2.26 and generated revenue of $12.2 billion, an increase of 31% from 2020.

2) Newmont Corporation (NYSE: NEM)

Newmont Corp… is a gold producer in North America, South America, Nevada, Australia and Africa. 

Newmont Corp’s code of conduct publicly lays out the high standards of conduct expected of employees, officers and directors, as well as partners, vendors and contractors. Newmont is a founding member of the Partnering Against Corruption Initiative and adheres to a strict business integrity policy and standards designed to prevent corruption…

The company has an independently operated, 24-hour hotline, called the Integrity Helpline, in which any stakeholder can report unsafe and unethical behavior… 

Newmont ended Q3 with $4.6 billion of consolidated cash and $7.6 billion of liquidity… Over the last four quarters, Newmont has steadily reinvested in operations while returning more than $2 billion to shareholders through dividends and share buybacks.

3) CBRE Group Inc. (NYSE: CBRE)

CBRE Group, Inc… provides commercial real estate and investment services through its advisory services, global workplace solutions and real estate investments segments, including property leasing, capital markets, property management, project management services and valuation services, contractually-based outsourcing services and global investment management services…

(It’s) Standards of Business Conduct was completely revised in 2021 so its workforce of more than 100,000 employees could read and understand it. The document emphasizes its RISE values: respect, integrity, service and excellence. Personnel and board members must both act ethically and adhere to standards of business conduct…

Capital markets activity and global property sales revenue exceeded posted United States increases, with revenue up 116%. International markets also saw strong increases versus last year’s third quarter, paced by Australia and the United Kingdom.” End quotes.

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4. Beat Inflation With These ESG Funds?

Now I’m excited by this fund featured in this article titled A New ESG Fund Launches Today. Why Its Top Holdings Are GM and Occidental. It’s by Evie Liu and was on Barrons.com. Quote.

“The path to cutting carbon emissions to zero has to go through the largest emitters, Engine No. 1, the investment firm behind the successful shareholder campaign to reshape oil giant Exxon Mobil, believes. That’s why the firm launched an exchange-traded fund to invest in legacy companies that will drive and benefit from the energy transition. 

The Transform Climate ETF (ticker: NETZ)… focuses on firms in some of the largest carbon-emitting industries—such as transportation, energy, and agriculture—that have shown commitment to credible decarbonization plans. It will also look for firms whose products and services help enable the transition to a low-carbon economy…

‘We believe there is no way to decarbonize the planet without these companies transforming, and there is no time to lose,’ says Engine No. 1 founder Chris James…

The fund’s top three holdings at launch are General Motors ( GM ), Deere ( DE ), and Occidental Petroleum ( OXY ), names you don’t see often in green funds…

The Transform Climate fund is Engine No. 1’s second ETF and first actively managed thematic fund. It charges an annual expense ratio of 0.75%.” End quotes.

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5. Beat Inflation With This ESG Fund?

Want just one ESG fund to invest in? You might want to review this article titled 1 Fund to Invest in a Sustainable Future. It’s by Frederic Slade and found on fool.com. Quote.

“The iShares USA ESG Select ETF has a Morningstar score of 5 and an MSCI score of AAA, while a competitor, the Calvert Equity Fund-A (NASDAQMUTFUND: CSIEX) has scores of 5 and AA, respectively.

The iShares fund scores higher with MSCI in part because its Top 5 holdings include only one stock with an MSCI rating below A: Alphabet Inc Class A (NASDAQ: GOOGL), which is rated BBB, average for its industry…

Morningstar and MSCI’s approaches to scoring sustainability differ, so you should use both to research different funds…

The expense ratio for an actively managed fund such as Calvert Equity A can approach 1% – 0.94%, in Calvert’s case – while passive funds like iShares USA ESG Select ETF have expense ratios in the 0.10% to 0.25% range…

If you’re looking for a diversified fund that scores well in sustainability and boosts your portfolio’s return, iShares USA ESG Select ETF might make a great place to start your search.” End quotes.

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Analyst Recommendations Related to UK, Australian, and European ESG Stocks and Funds

1. Title 5 exciting investment funds to keep an eye on in 2022 | Fool UK by George Sweeney. Two of the funds might be considered by ethical and sustainable investors. They are the Trojan Ethical Income (F00000WQ4M.L) and Legal & General Future World ESG Developed Index (GB00BMFXWS95:GBP).

2. Title 2 ASX shares riding the wave of green energy and ethical investing (fool.com.au). They are Australian Ethical Investments Limited (ASX: AEF) and Fortescue Metals Group Limited (ASX: FMG). The latter has a significant and growing ‘green energy and green technology with a vision to make green hydrogen,’ says the author.

3. Title Financial Friday: Which sustainable funds are investors buying? (fidelity.co.uk). By Toby Sims. Quote “Runaway leader, the L&G MSCI World Socially Responsible Investment SRI Index Fund, as well as the iShares Global Clean Energy UCITS ETF and the L&G Future World Climate Equity Factors Index on this list, are all passive funds.” End quote.

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Ending Comment

Well, these are my top news stories with their stock and fund tips — for this podcast: “Beat Inflation With These ESG Stocks, Analyst.”

To get all the links, stock symbols, or to read the transcript of this podcast — and more — go to investingforthesoul.com/podcasts and scroll down to this episode.

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Talk to you next on February 25. Bye for now.

© 2022 Ron Robins, Investing for the Soul.