Climate change is increasingly on the minds of business leaders and investors. And thus, there are a number of stocks to buy that investors should take a look at.
Overall, the Economist Intelligence Unit has estimated that climate change could cost the world economy $7.9 trillion by 2050 as drought, flooding and crop failures hurt growth and damage infrastructure. So with the economic impacts worsening, many companies are turning their attention to solving the climate crisis and reversing the damage that’s being done on every continent.
Whether it is the cars we drive, the food we eat, or the houses we live in, corporate America is changing the ways in which we live in order to lessen our reliance on fossil fuels and make the world a more sustainable place. Therefore, let’s look at three stocks to buy in order for investors to profit from the global war against climate change.
Now, let’s dive in and take a closer look at each one.
Stocks to Buy: Beyond Meat (BYND)
The stock of plant-based meat substitute company Beyond Meat continues to move in fits and starts. But despite an erratic looking chart, BYND stock is up 12% year-to-date at $140.38 a share. The company’s share price popped 7% on June 28 after it was announced that Beyond Meat was partnering with food delivery giant DoorDash (NYSE:DASH) to offer a summer grilling kit that includes a grilling mitt, apron, bottle opener, recipe card and the latest version of the “Beyond Burger,” all for $14.99.
The DoorDash deal is the latest in a series of partnerships that Beyond Meat has tried, with mixed results. The company has strategic partnerships to sell its plant-based products in Walmart (NYSE:WMT) stores and supply McDonald’s (NYSE:MCD) with plant-based patties. However, a trial with Burger King didn’t work out so well. Beyond Meat’s products, which the company markets as being healthier for the environment and people, continue to grow. In this year’s first quarter, U.S. retail sales increased 28% year-over-year and international retail sales grew 189% from the first quarter of 2020.
Enphase Energy (ENPH)
Freemont, California-based Enphase Energy designs and builds renewable home energy products, mostly related to solar power. Specifically, the company manufactures the software needed to control and monitor residential solar panel systems. Growing demand for renewable energy is spurring sales of Enphase Energy’s products. In the first quarter, the company’s revenue came in at $302 million, up 50% from $206 million a year earlier. Operating income came at $61 million, up 36% from $45 million a year ago.
ENPH stock has exploded in the past year. The share price has risen 268% in the last 12-months to its current level of $186.44. In July 2020, Enphase Energy’s stock was trading at $50 a share. Wall Street remains bullish on the company and its future growth prospects. The median price target on the stock is $200 a share, with a high estimate of $225. The median price target represents a further 8% upside.
Currently, more than 80% of Enphase Energy’s revenues come from the U.S. market, and the company is now setting its sights on global expansion.
Stocks to Buy: Ballard Power Systems (BLDP)
Ballard Power Systems is a Canadian-headquartered manufacturer of hydrogen fuel cells that some people feel will revolutionize the automotive sector and are key to saving us from the ravages of climate change. The Burnaby, British Columbia-based company also provides clients with engineering services. Founded in 1979, Ballard Power’s stock has struggled mightily over the past year. Through the first six months of this year, BLDP stock has declined 25% to $16.83 a share.
The decline in BLDP stock has been primarily due to poor earnings results. In the first quarter, the company reported revenue of $17.6 million, a 26% year-over-year decline and well below the $25.7 million that analysts had expected. Ballard also reported a $0.06 loss per share in the quarter, more than the $0.04 loss that analysts had forecast. The company’s shares fell 20% immediately after the earnings results.
Despite the poor results and stock depreciation, there are reasons to remain bullish on Ballard Power Systems and the hydrogen fuel cell industry. The hydrogen fuel cell market is forecast to reach $4.57 billion by 2027 for a compound annual growth rate (CAGR) of 26.8%, according to market research firm Insight Partners.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.
