Although there are plenty of stocks to buy outside of solar energy and electric vehicles, investors interested in putting their capital behind climate change often gravitate toward those few areas.
That’s a great place to start (this list does feature solar energy stocks), but there also are a few other areas to direct one’s capital in fighting climate change. Those less often talked about sectors are also doing their part in fighting climate change.
All of these stocks broadly fight climate change in the same way: by helping to reduce carbon emissions. It has been noted that carbon emissions are the primary contributor to global climate change. In order to prevent the worst effects of climate change the world needs to reduce its emissions.
Investors know that identifying firms and investing in those firms is one way to champion the fight. That generally leads investors toward ESG investing which has become increasingly important.
That said, let’s look at some stocks connected to the fight against climate change.
- Trane Technologies (NYSE:TT)
- Owens Corning (NYSE:OC)
- Brookfield Renewable Partners (NYSE:BEP)
- Enphase Energy (NASDAQ:ENPH)
- General Electric (NYSE:GE)
- Beyond Meat (NASDAQ:BYND)
- Google (NASDAQ:GOOG)
Climate Change Stocks to Buy: Trane Technologies (TT)
Building construction accounted for 38% of total global carbon emissions in 2020. That’s why Trane Technologies should make a lot of sense as a climate change-oriented investment.
Brandon Rakszawski, VanEck director of ETF product development, notes that the HVAC industry is one to consider as buildings and carbon emissions are becoming increasingly important.
Leading ratings firms including Morgan Stanley (NYSE:MS) have hand-picked Trane Technology as a leader in that field.
The company has set an objective to reduce its carbon emissions by one gigaton(1). As property management firms up their effort to reduce emissions Trane’s HVAC leadership will become increasingly attractive which should lead to stronger fundamental performance and higher stock prices.
Owens Corning (OC)
Owens Corning products help reduce carbon emissions from buildings.
While Trane Technologies is more concerned with efficient HVAC systems which drive efficiency up and emissions down, Owens Corning is on this list for insulation.
In 2020 insulation accounted for 36% of the firm’s revenues which should interest green investors. Insulation often relies on harsh chemicals which aren’t particularly environmentally friendly. Owens Corning received high ratings from MSCI across sustainability measures and has a goal to reduce its carbon emissions by half by 2030.
The company should raise investor eyebrows for its performance as well. Throughout the four financial quarters of 2021 OC stock performed well. The company exceeded EPS targets in each of those four quarters posting several impressive earnings beats.
On top of that, there looks to be substantive upside based on target prices. OC stock trades at $92 but carries a consensus target price of $121 according to analysts.
Owens Corning might not garner the headline space for green initiatives that Tesla (NASDAQ:TSLA) or solar companies do, but it’s about value here. The company is a solid performer with green directives. That should matter, especially now as money rotates into value from tech and growth.
Brookfield Renewable Partners (BEP)
Brookfield Renewable Partners maintains a massive portfolio of projects directed toward renewable energy.
The company’s hydro, wind, solar, and transitional technologies, both operational and developmental, is significant.
The company has a sustained vision to deliver 12-15% returns annually along with annual distribution growth between 5-9%. That may be the strongest reason to invest in the company.
The firm’s massive footprint globally places it in prime position to capitalize on the growing opportunity.
BEP stock has been volatile over the past few years but is trending steadily upward. The firm recently announced record results and exceeded the $1 billion threshold for Q4 revenues. That led to net income which reached $33 million signaling a turnaround of sorts.
Enphase Energy (ENPH)
Enphase Energy manufactures and designs microinverter systems for the solar photovoltaic industry.
When investors consider solar power they likely imagine large arrays of photovoltaic cells that capture sunlight as energy.
That energy is captured as DC power. Microinverters are located below those cells and convert that DC power to AC power which can be used in your home.
According to a recent Barron’s article Enphase is leading the way in the solar sector. Its strong quarterly earnings in early February sent its stock upward by 11%.
SunRun (NASDAQ:RUN) up 5% absent news from that firm. Strong results from one company in a sector often pull up related firms. That’s nothing new. But it does point to the idea that Enphase Energy is a force to consider.
The positive news for the company is manifold: It posted record revenues of $412.7 million leading to EPS figures of 73 cents. Analysts were pleasantly surprised as they anticipated $400.2 million in revenues and 59 cent EPS figures.
Climate Change Stocks to Buy: General Electric (GE)
General Electric has been directing large sums of capital toward clean energy initiatives over the past few years.
It has pumped $15 billion into wind, solar, and hydro projects and reports 400 gigawatts of installed renewable energy capacity globally.
The company remains focused on those initiatives which should help it over the long term. That said, the company does have troubles currently.
Namely, supply chain issues are affecting the firm according to VP Steve Winokur.
That news could keep GE stock somewhat lower through Q2 but the firm remains steadfast in its commitment to green initiatives. It has divested parts of its aircraft leasing business while making clean initiatives a priority.
It is pivoting in that realm. GE recently announced that it will test flying an Airbus A380 on hydrogen fuel in conjunction with Safran.
Beyond Meat (BYND)
The short-term news for Beyond Meat isn’t actually very appealing. Its stock is trading at historical lows.
The plant-based meat producer recently failed to meet analyst expectations as a sharp decline in U.S. grocery sales directly affected it.
While the company did see higher revenue from international markets and foodservice customers, U.S. grocery sales hurt the firm. Those sales decreased 20% in the quarter, more than offsetting its improvements elsewhere. That resulted in the firm reporting an $80.4 million net loss in the quarter that ended 2021.
So, yes, Beyond Meat does have immediate troubles, but those short-term woes don’t invalidate the longer-term narrative behind the firm and its products.
The plant-based food market is set to grow from $29.4 billion in 2020 to $162 billion by 2030. It isn’t a sure bet by any means and BYND stock has shown volatility in its short life as a publicly-traded entity.
On the other hand, Beyond Meat has a dominant position in the meat alternative market. That matters moving forward.
Climate Change Stocks to Buy: Google (GOOG)
Google is usually in the headlines for reasons which don’t relate to its clean initiatives, but that shouldn’t be the case.
Google has been carbon-neutral since 2007, according to Insider Monkey.
As in many realms, Google is leading the way in clean energy as well. Google delivers 7 times as much computing power as it did five years ago.
Incredibly the company does so while using the same amount of energy as it did five years ago. On top of that, Google plans to run on 100% carbon-free energy by 2030. It’s one of many reasons to consider investing in Google.
On the date of publication, Alex Sirois 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.
Alex Sirois is a freelance contributor to InvestorPlace whose personal stock investing style is focused on long-term, buy-and-hold, wealth-building stock picks. Having worked in several industries from e-commerce to translation to education and utilizing his MBA from George Washington University, he brings a diverse set of skills through which he filters his writing.