Green Giants: The 3 Best ESG Stocks for a Sustainable Portfolio


  • These three ESG stocks offer investors an alternative look at companies beyond their financials.
  • Owens Corning (OC): OC is an industrial materials company with strong ESG performance.
  • Baker Hughes (BKR): This is an energy technology company with solid 2nd quarter performance and a Strong Buy analyst recommendation.
  • Host Hotels & Resorts (HST): HST is a REIT with a portfolio of luxury hotels positioned to take advantage of travel market recovery.
best esg stocks - Green Giants: The 3 Best ESG Stocks for a Sustainable Portfolio

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Let’s face it: Investors will always look for different ways to analyze the market and find their investment edge. One of the growing strategies in the last few years has been in the realm of ESG investing, which focuses on companies that make their impact on the world a high priority. That shift in investment view has made data providers acknowledge the need for such analysis and made way for tracking the ESG scores of companies. According to McKinsey & Company’s research, sustainability is one of the additional drivers for a company to perform even better.

Companies like MSCI (NYSE:MSCI), London Stock Exchange Group, Morningstar (NASDAQ:MORN) and other data providers, offer their clients a quantitative view of a company’s goals in environmental, social and governance factors. They do this to better quantify the company’s impact and initiatives in the environment, society and its employees via proprietary analytics. That gives investors an objective look at the organization beyond its financial statement. If you want to align your investment strategy with personal beliefs like climate change awareness, social responsibility and more, then ESG investing may be for you. Here are three of the best ESG stocks investors should buy now.

Owens Corning (OC)

Image of the foundation and frame of a house

Owens Corning (NYSE:OC) is a building and industrial materials company that operates a Composites, Insulation, and Roofing segment. Its products include glass reinforcement materials, glass fiber products, low-mid-high temperature products for insulation, laminate, street asphalt and roofing. The company has built a reputation as one of the best choice for customers looking to replace their roofing.

Owens Corning is one of the top choices for ESG investors, garnering high marks from various ESG analysis providers. OC recently announced the appointment of its new insulation segment president, Nicolas Del Monaco, with the previous president, Todd Fister, transitioning as chief financial officer. Besides being one of the top companies in terms of ESG, the company has delivered another strong quarter with better margins and earnings performance. OC is also focused on process innovation, new product development and existing product improvement to provide more growth. It had 17 new or refreshed products launched in the first half of 2023. With sustainability metrics and financial performance at the top of their game, Owns Corning is one of the best ESG stocks to buy.

Baker Hughes (BKR)

The Baker Hughes (BKR) sign and office building in Houston, Texas.
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Baker Hughes (NASDAQ:BKR) is an energy technology company operating in the Oilfield Services & Equipment (OFSE) and Industrial & Energy Technology (IEM) segments of the industry. BKR’s OFSE segment provides products and services designed for onshore and offshore oil and gas operations across a well’s entire lifecycle. Meanwhile, its IEM segment offers technology-based solutions ranging from compression, power generation and mechanical drive applications across the whole energy industry.

Baker Hughes is another highly-rated stock in terms of sustainability. The company has an extensive sustainability strategy built upon social, environmental and corporate responsibility. Financials-wise, revenue is up by 25% year-over-year (YoY), and adjusted EBITDA also increased by 39% YoY. Second-quarter EPS also beat estimates by 21.87%. No wonder the company is a favorite of analysts, earning it a Strong Buy recommendation. Its solid ESG rating and excellent financial performance have put it on our best ESG stocks list.

Host Hotels & Resorts (HST)

Woman standing in hotel room with luggage looking at the view. Hotel stocks.
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Host Hotels & Resorts (NASDAQ:HST) is a real estate investment trust (REIT) that owns and manages a portfolio of luxury and upper-upscale hotels. Its portfolio of brand names includes luxury hotels like Grand Hyatt, Ritz-Carlton, Hilton and Marriot. HST owns around 77 hotels and 41,900 rooms. The company is the largest lodging REIT and holds non-controlling interests in domestic and international ventures.

Host Hotels & Resorts is another highly-rated company in terms of ESG, wherein responsible investment is a core focus of the company’s corporate responsibility program. HST aspires to be net positive by 2050 and has a 2030 roadmap for sustainability targets. Meanwhile, Q22023 margins took a hit as the company sought to stabilize its staffing levels and increase wages. Higher insurance and utility expenditures also contributed to the decline. HST expected this decrease, however, and it is also worth noting that the travel industry is still in recovery. Demand is expected to grow. The company is still in a solid position due to its excellent property locations and brand recognition. HST’s strong potential to take advantage of the market recovery and its commitment to sustainability goals make it one of the most recommended ESG stocks to buy.

On the date of publication, Rick Orford did not hold (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 Publishing Guidelines.

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