How will green stocks perform in a recession?
I'm doing a speech on Going Green on investing in green companies. I am posting here in hopes to get some theories on how people think Green stocks will do if we end up in a full blown recession? While you're at it, if you have some decent green stocks that you think have good looking financials or you think are worth looking at, let me know. Like I said, I'm looking for ideas. I have a few I am focusing on, but I can always use more. Thanks!
- Anonymous1 decade agoFavorite Answer
You're kidding right?
Dave M how are those stocks doing for you now right now? Now remember we aren't in a recession yet.
Look, green company's/products are doomed to fail unless they are mandated by the government. Take the incandescent light bulb verses florescent. The "green bulbs" cause headaches and are a bio hazard if they break. Green products are outclassed by there non green counterparts in very category so green companies must lobby and get government mandates to take out the competition. That's not exactly capitalism.
Look at the historical stock prices of any "green" company you like. They aren't profitable.
GE isn't exactly a green company but the do make the green bulb. GE is as green as I get when it comes to investing so if you have to pick a company to talk about I would choose GE.
By the way - GE is the parent owner of NBC, the network that uses its nightly news to push GE products including the "green bulb". GE is also involved in lobbing the government when it comes to mandates. Do your research. Its all true.Source(s): The market and Dave M's stocks he listed.
- 1 decade ago
Green stocks will suck possibly more than other stocks because most of the products sold by a Green company cost more than similar products produced by others. Since, in a recession, people have less money to spend or are unwilling to spend what they do have excepting for the best price the Green guys will generally have to tread water a bit longer than others. Buying Green stocks shouldn't be a decision made primarily on profit/return. They don't generally show the returns when compared to their non-Green peers. You have to go with your heart to go totally Green, not with your wallet. The market will shift upwards when it sees the bottom of the recession, way before the rest of us see it.
- 1 decade ago
I agree the sector is overvalued and I would hold off purchasing the sector as a long term investment. My biggest concern isn't a worldwide recession but the drying up of government incentives in stronger economies like Germany which has driven the solar sector. I also don't like the inefficiency of solar. Without generous incentives the payback on it for power production is nonexistent if you discount it at the risk free rate.
I do like the stock TSX listed Timminco as it is well positioned to benefit from growth if it comes but I would wait for a major pullback on it and some clarity on government incentives.
- David MLv 71 decade ago
I own 3 green stocks:
Zoltek (ZOLT) - manufacturer of carbon fiber used in blades of wind turbines. Also to be used in cars to make them stronger, lighter and more fuel efficient to meet new CAFE standards.
Plug Power (PLUG) - manufacturer of fuel cells. One day will be used in zero emissions cars. Also will make home units which produce the hydrogen that will fuel those cars.
Composite Technologies (CPTC) - manufactures wind turbines and high efficiency electrical cable that saves energy.