These 3 ESG Stocks Are Perfect for Socially-Conscious Investors

ESG stocks - These 3 ESG Stocks Are Perfect for Socially-Conscious Investors

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  • MSCI Inc. (NYSE:MSCI) – It’s seen as the “go-to” option for ESG research and has established a dominant market position.
  • Sibanye-Stillwater Limited (NYSE:SBSW) – The company serves the ever-expanding electronic vehicles market (EV) and has gained respect as a Bloomberg Gender Equality constituent.
  • Adobe Systems Inc. (NASDAQ:ADBE) – An emphasis on data protection has paid dividends as Adobe’s earnings suggest that it provides various “best-in-class” solutions to the computer software market.

Environmental, Social, and Governance (ESG) investing is becoming a global phenomenon but is still misunderstood among many investors.

ESG stocks are considered a profitable alternative to impact investing. They emphasize a “best-in-class” screening process to find instances where environmental, social, and governance factors have resulted in more efficient and profitable enterprises.

Many of today’s cutting-edge investors have developed a liking for ESG stocks as they tend to exhibit lower volatility and provide excess market returns.

I did a bit of scouting and found three stocks with promising ESG initiatives that could provide you with life-changing returns.

MSCI Inc. MSCI $482.70
Sibanye-Stillwater Limited SBSW $16.52
Adobe Systems Inc. ADBE $420.44

ESG Stocks to Buy: MSCI Inc. (MCSI)

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MSCI is the cornerstone ESG research tool out there which is why many portfolio managers use the company’s comprehensive databank.

In addition, MSCI’s index tracking technology is linked to over $1 trillion in ETF assets under management. This validates it as a market leader in its domain.

MSCI recently beat its fourth-quarter earnings estimates by 2 cents per share as its organic operating revenue surged by 20%.

The firm’s penetration of the Asia Pacific market has been influential. Its regional sales spiked by 71% during the previous year with EMEA and North American sales following suit with 49% and 10% growth, respectively.

Analysts anticipate its diluted earnings-per-share to grow by 18.95% in the next year, suggesting that investors might benefit from growing residual value.

Sibanye-Stillwater (SBSW)

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Mining stock Sibanye-Stillwater has a significant presence in the platinum group metals (PGM) space, which facilitates resources for the electronic vehicles market.

The company has improved its social profile lately by incorporating safety audits of its mines to reduce work-related injuries.

Another factor to be impressed about is Sibanye-Stillwater’s inclusion in the Bloomberg Gender-Equality Index, which indicates that it emphasizes fairness to women in the workplace.

Operationally speaking, Sibanye crushed it during the past year. The company’s headline earnings grew by 27%, in turn, producing earnings of 76 cents per share.

The mining company’s recent success can be credited to its “renewable metals” portfolio, which has thrived in a higher price environment and added significant value to the stock. 

SBSW’a valuation multiples indicate that the market’s underappreciated its recent success, leaving it undervalued. The stock’s trading at a price-to-earnings ratio of only 5.35x, a PEG ratio of 0.88x, and a price-to-cash flow multiple of 6.09x.

Finally, I’d recommend taking advantage of Sibanye’s current momentum pattern, which sees it trading above its 10-, 50-, 100-, and 200-day moving averages.

ESG Stocks to Buy: Adobe (ADBE)

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Adobe CEO Jonathan Vaas has said that  ESG is a critical component of the company’s approach.

Adobe prides itself on protecting customer data using a certified information management system, adopting encryption technology, and introducing an intrusion detection system.

Adobe has rediscovered its form lately with a first-quarter earnings beat of 3 cents per share.

ADBE’s digital media segment’s annual recurring revenue expanded by $418 million during the quarter, and its digital experience subscription revenue grew by 15% year-over-year to reach $932 million.

Additionally, Adobe has $13.83 billion in remaining performance obligations, telling us that there’s an abundance of demand for its product offerings.

At below $450 per share, ADBE provides a lucrative entry point. The stock is down more than 25% year-to-date as the result of systemic headwinds rather than idiosyncratic fault lines. Thus presenting itself as a “buy the dip” opportunity.

On the date of publication, Steve Booyens held a long position in SBSW. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Steve co-founded Pearl Gray Equity and Research in 2020 and has been responsible for institutional equity research and PR ever since. Before founding the firm, Steve spent time working in various finance roles in London and South Africa. He holds an MSc in Investment Banking from Queen Mary – University of London and is working towards his Ph.D. in Finance, in which he’s attempting to challenge the renowned Fama-French 5-factor pricing model by incorporating ESG factors. His articles are published on various reputable web pages such as Seeking Alpha, TipRanks, Yahoo Finance, and Benzinga. Steve’s articles on InvestorPlace form an interesting juxtaposition between mainstream opinion and objective theory. Readers can expect coverage on frequently traded stocks, cryptocurrencies, crowdfunding, and ETFs.


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