Podcast: Great Sustainable Stock Buys

Ethical & Sustainable Investing News to Profit By!

Great Sustainable Stock Buys include everything from automakers to waste management to renewable energy stocks. Four articles reviewed, eleven referenced!

Transcript & Links, Episode 113, September 8, 2023

Hello, Ron Robins here. So, welcome to this podcast episode 113 titled “Great Sustainable Stock Buys.” It’s presented by Investing for the Soul. Investingforthesoul.com is your site for vital global ethical and sustainable investing mentoring, news, commentary, information, and resources. And look at my newly revised website at investingforthesoul.com! Tell me what you think.

Now, remember that you can find a full transcript, and links to content – including stock symbols and bonus material – on this episode’s podcast page located at investingforthesoul.com/podcasts.

Also, a reminder. I do not evaluate any of the stocks or funds mentioned in these podcasts, nor do I receive any compensation from anyone covered in these podcasts. Furthermore, I will reveal to you any personal investments I have in the investments mentioned herein.

Additionally, quotes about individual companies are brief. Please go to this podcast's webpage for links to the actual articles for more company and stock information. Also, some companies might be covered more than once and there are also 11 article links below that time didn’t allow me to review them here.

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Great Sustainable Stock Buys - 1

The first article reflecting today's theme is titled 3 Sustainable Companies Helping to Solve Global Warming. It’s by Leslie Norton and seen on morningstar.com. Here’s some of what Ms. Norton has to say.

“Zoetis ZTS

About two thirds of Zoetis’ sales come from the pet business, which has doubled over the past four years… The rest of Zoetis’ sales comes from its livestock-related business…

• Morningstar Fair Value Estimate: $170
• Morningstar Rating: 3 stars
• Morningstar Uncertainty Rating: Medium
• Morningstar Economic Moat Rating: Wide
• Morningstar Comment: Zoetis enjoys a wide moat and secular tailwinds, notes senior analyst Debbie Wang.

Stellantis STLA

Stellantis is one of the world’s top five automakers, with brands like Chrysler, Peugeot, Jeep, Maserati, and Alfa Romeo… Galvanize Global Equities thinks Stellantis’ profitability can ‘well’ exceed what the market expects, even with the company’s big investments. The stock trades at 1 times earnings, according to Galvanize, creating ‘a compelling entry point’ as the auto industry evolves for the low-emissions era.

• Morningstar Fair Value Estimate: $43
• Morningstar Rating: 5 stars
• Morningstar Uncertainty Rating: High
• Morningstar Economic Moat Rating: None
• Morningstar Comment: Stellantis’ revenue and profit margins ‘continue to impress,’ notes senior analyst Richard Hilgert.

GFL Environmental GFL

This Canadian waste management company services residential, commercial, municipal, industrial, and institutional customers. It is North America’s fourth-largest environmental services company… Recently, GFL announced a series of efforts to boost the capital it will commit to clean technologies and plans to align its executive compensation with climate targets.

• Morningstar Quantitative Fair Value Estimate: $36.11
• Morningstar Quantitative Rating: 3 stars
• Morningstar Quantitative Uncertainty Rating: High
• Morningstar Quantitative Economic Moat Rating: None”

End quotes.

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Great Sustainable Stock Buys - 2

Now the majority of articles on sustainable companies continue to focus on renewable energy stocks. This is the first of two on that subject covered in today’s podcast. It’s titled Top Solar Stocks for Q3 2023. By Timothy Smith and found on investopedia.com. Here’s some of what Mr. Smith writes.

“1) Best Value Solar Stocks

The solar stocks presented in the table below have the lowest 12-month trailing price-to-earnings (P/E) ratio…

Daqo New Energy Corp. (DQ):

The Chinese-based company produces ultra-pure polysilicon used in solar cells, modules, ingots, and wafers. The trailing P/E ratio is 2.6.

JinkoSolar Holding Co. (JKS):

It offers solar modules, silicon wafers, solar cells, recovered silicon materials, and silicon ingots… The company reported in August that its second-quarter module shipments increased 36.2% sequentially, and 74.4% from a year earlier. The trailing P/E ratio is 4.9.

Canadian Solar Inc. (CSIQ):

It is known for its innovative photovoltaic technology and project development expertise. The trailing P/E ratio is 7.2.

2) Fastest-Growing Solar Stocks

The top three solar stocks ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly year-over-year (YOY) percentage revenue growth and most recent quarterly YOY EPS growth…

Canadian Solar:

See company description above. EPS Growth 750%. Revenue Growth 36%.

SolarEdge Technologies Inc. (SEDG):

Manufactures and sells solar ingots, wafers, cells, modules, and other solar power and battery storage products globally. EPS Growth 681%. Revenue Growth 35%.

Hannon Armstrong Sustainable Infrastructure Capital Inc. (HASI):

Provides capital and services to the energy efficiency, renewable energy, and other sustainable infrastructure markets in the U.S. EPS Growth N/A. Revenue Growth 155%.

3) Solar Stocks with the Most Momentum

These… solar stocks… have delivered the highest total return over the past year…

First Solar Inc. (FSLR):

Provides photovoltaic (PV) solar energy products globally. 12-Month Trailing Total Return 69%.

Array Technologies Inc. (ARRY):

Specializes in solar tracking systems for utility-scale projects. 12-Month Trailing Total Return -7.1%.

Shoals Technologies Group Inc. (SHLS):

Provides electrical balance of systems (eBoS) products for solar energy projects. 12-Month Trailing Total Return -17.5%.”

End quotes.

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Great Sustainable Stock Buys - 3

And the next article with this theme is titled Top 10 Renewable Energy Stocks To Invest In. It’s by Jonathan Schramm and found on securities.io. Now some of what Mr. Schramm has to say about each of his picks.

“This list was made to reflect the diversity of the sector, and is organized by market capitalization at the time of writing of this article.

China Power Co., Ltd. (600900.SS)

China Yangtze Power is the largest electric power company in China and the largest hydropower company in the world, with 71.7 GW of total capacity installed.

The company also has hydropower businesses in Brazil, Sudan, Pakistan, and Malaysia, and wind power generation in Germany.

Iberdrola, S.A. (IBE.MC)

Iberdrola is one of the world leaders in green energy generation…

Iberdrola operates mostly in Spain, with operations in the rest of Europe, North America, and Brazil…

Ørsted A/S (DNNGY)

The Danish energy producer has gone through a massive transformation, from 2006 when it produced 83% of its power from fossil fuels to 2022 with only 8% left over, and on track to reach 99% renewable production by 2025.

Half of this power generation is from offshore wind farms, with the rest roughly equally split between solar and onshore wind farms… Orsted has wind farms in Denmark, the UK, Germany, the US, Taiwan, and Vietnam.

Vestas Wind Systems A/S (VWDRY)

Vestas is a designer, manufacturer, and installer of wind turbines… It controls 35% of the wind manufacturing market excluding China, up from only 20% in 2010… It is also the only one with a (strongly) positive EBIT (Earnings Before Interests and Taxes), thanks to its economies of scale…

Vestas has recently unveiled a new epoxy chemistry allowing for full recycling of wind turbine blades.

First Solar, Inc. (FSLR)

First Solar is the largest solar panel manufacturer in the USA and in the whole Western hemisphere…

The company… uses its proprietary thin-film photovoltaics. Based on cadmium-telluride, they are more efficient, are produced at a lower cost, and can be easily mass-manufactured. Thin-film solar panels are also more durable, retaining 89% of the original performance after 30 years…

Thin-film panels can also have high recycling rate.

Brookfield Renewable Partners L.P. (BEP)

Brookfield Renewable Partners, or BEP, is part of the massive asset management firm Brookfield, handling $625B in assets, which owns 48% of BEP…

The current assets are a mix between hydropower, wind, and solar, with the bulk of the future production growth planned to be in solar, followed by energy storage and wind…

Another important development for BEP in 2023 is the closing of the acquisition of Westinghouse, the leading nuclear plant builder in North America…

BEP has generated annualized returns of 16% for its shareholders since 1999… It also… distributes a rather generous dividend.

Ormat Technologies, Inc. (ORA)

Ormat is the 2nd largest geothermal owner and operator, and the largest publicly traded. The company has assets in the US, Kenya, Indonesia, and Central America+Caribbean…

Ormat is also entering the energy storage market…

Revenues grew by 10.7% in 2022, maintaining a strong growth trajectory since 2017…

Geothermal is… able to provide stable baseload power and benefit from quickly improving technology.

Shoals Technologies Group, Inc. (SHLS)

Shoals is specialized in EBOS (Electrical Balance of System), or all the systems surrounding the solar panel themselves and which are required to make it work. This does not include inverters, but cables, switches, fuses, electric boxes, etc....

Between 2020 and 2022, Shaols has grown its revenues by 36% CAGR and its gross profit by 40% CAGR.

Daqo New Energy Corp. (DQ)

This Chinese company is one of the world's leaders in polysilicon production, the central component for solar panel manufacturing…

In 2023, the stock is trading very cheaply compared to P/E or cash flow. This is partially due to controversies, with the company linked to the use of forced labor in Xinjiang, and talks in Washington DC of additional sanctions against companies operating in the region.

JinkoSolar Holding Co., Ltd. (JKS)

Jinko is one of the largest solar panel manufacturers in the world, based mostly in China. The company is diversifying its manufacturing base, with silicon wafer manufacturing in Vietnam, and solar cell manufacturing in Malaysia and the US…

Module shipments to China have doubled year-to-year, and increased 50% for Europe.

Jinko's most advanced solar cell, the N-type, achieves a remarkably high 25.8% energy efficiency.”

End quotes.

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Great Sustainable Stock Buys - 4

And we have this from Australia. It’s titled 3 ASX shares for sustainable investment returns and it’s by Damian Cottier and seen on raskmedia.com.au. Here are some quotes from Mr. Cottier about his picks.

“Telix Pharmaceuticals (ASX: TLX)

The global sales of its Illucix product for the imaging of prostate cancer continue to exceed market expectations… and urologists are seeing patient benefits from the technology…

Telix’s product, which aims to distinguish between benign and malignant renal lesions, had previously received ‘Breakthrough Designation’ from the U.S. Food and Drug Administration (FDA). Current imaging cannot reliably make this distinction, leading to invasive biopsy procedures that are not always necessary as up to 80% are not malignant.

Alpha HPA Ltd (ASX: A4N)

Specialises in low-cost, low-carbon, high-purity alumina. These ingredients have applications mostly across lithium-ion batteries, semiconductors, and LED lights, all critical to decarbonisation.

Earlier in the year Alpha HPA announced it reached an agreement with Austrian-based global industrial company Ebner Industrieofenbau Gmbh, to enable Alpha to produce synthetic sapphire glass which is a downstream product of the company’s high-purity alumina (‘HPA’) production process.

Calix Ltd (ASX: CXL)

It is an industrial solutions company dedicated to solving global sustainability challenges, including:

• Calix’s LEILAC technology assists in CO 2 mitigation in the global lime and cement industry.
• Joint Venture with Pilbara Minerals Ltd (ASX: PLS) for more efficient and less carbon intensive processing of lithium ore.
• Adapting the core LEILAC technology for other applications with support from government agencies globally including Zero Emissions Steel, sustainable marine and aviation fuels and zero emissions shipping.”

End quotes.

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Other Honorable Mentions – not in any order.

1) Title: UN SDGs ‘seriously off track’ as investors question portfolio alignment on etfstream.com. By Theo Andrew.

2) Title: guidingdirection.com on abyok.com. By Conscious Capital.

3) Title: How a Top-Performing ESG Fund Invests in Energy Stocks on barrons.com. By Lewis Braham.

4) Title: AMCR Named A Top Socially Responsible Dividend Stock on nasdaq.com. By BNK Invest.

5) Title: Why PNC Financial Services Group is a Top Socially Responsible Dividend Stock (PNC) on j2t.com. By just2trade.

6) Title: Top 10 Wind Turbine Manufacturers in Energy Magazine on energydigital.com. By Charlie King.

7) Title: Top 10 Solar Companies in Energy Magazine on energydigital.com. By Charlie King.

8) Title: Green Bonds Can Drive EM Renewables Adoption on etftrends. By Tom Lydon.

9) Title: Enphase Energy: A Solar Power Gem Trading Below Its True Worth (NASDAQ:ENPH) on seekingalpha.com. By The Beginner Investor.

10) Title: These Five Small-Cap Impact Stocks Are Punching Above Their Weight In Addressing Social and Economic Challenges nasdaq.com. By Ari Zoldan.

11) Title: 3 expert-picked funds that want to grow your money sustainably on fidelity.co.uk. By Nafeesa Zaman.

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Ending Comment

Well, these are my top news stories with their stock and fund tips -- for this podcast titled: “Great Sustainable Stock Buys.”

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Talk to you next on September 22nd!

Bye for now.

© 2023 Ron Robins, Investing for the Soul