The Motley Fool

Why Ibstock shares may be a great long-term investment

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Private investor buying UK shares at home
Image source: Getty Images

After a tough 2020 for Ibstock (LSE:IBST) shareholders, due to the damage done to the construction industry by Covid-19, we are now witnessing not just a return but a potential boom for Ibstock shares in 2021, as the UK slowly recovers.

As an overview, the Ibstock share price has increased 14% in the last 12 months and 5.5% since the start of the year. I see the subtle increase of this price as an indication for the re-emergence and a future boom in Ibstock shares.

One Killer Stock For The Cybersecurity Surge

Cybersecurity is surging, with experts predicting that the cybersecurity market will reach US$366 billion by 2028more than double what it is today!

And with that kind of growth, this North American company stands to be the biggest winner.

Because their patented “self-repairing” technology is changing the cybersecurity landscape as we know it…

We think it has the potential to become the next famous tech success story. In fact, we think it could become as big… or even BIGGER than Shopify.

Click here to see how you can uncover the name of this North American stock that’s taking over Silicon Valley, one device at a time…

This stock remains in this Fool’s long-term portfolio because of two main factors. One is the UK’s recovery from the worst effects of Covid-19, and the second is Ibstock’s decision to seize on the exciting opportunities and trends in the ESG market, as demonstrated in its 2019 sustainability report.

The future and rise of ESG

Whilst the future of energy is to be set on renewable energy sources, Ibstock’s commitment to 100% pure green electricity is excellent news for shareholders of the UK’s number one brick manufacturer.

In 2020, ESG stocks flourished during a period of great uncertainty as the worst effects of Covid-19 were realised – cash inflows into the ESG market as of November 2020 nearly reached $47 billion.

This momentum has continued into 2021 as the statistics indicate that ESG companies are investing the funds effectively. Trustnet data shows that ESG and sustainable companies are outperforming traditional stocks.

So where does this leave Ibstock shareholders?

As ESG stocks continue their bull run in 2021, companies that have integrated renewable energy solutions into their business models are sure to reap the rewards of ESG’s longevity.

According to its 2019 sustainability report, Ibstock’s environmentally conscious goals for 2025 include:

  • A 15% reduction in CO2 per tonne of production
  • 40% reduction in preventable plastic packaging
  • 5% reduction in mains water use per tonne of production
  • Zero waste to landfill

On top of these numbers, Ibstock has also achieved the incredible feat of developing the world’s first net-zero brick factory.

Ibstock’s socially responsible approach is the reason why the brick manufacturer should be set to thrive in a world that is investing in a more sustainable future.

Looking to the long term

In 2021, several G7 nations, including the UK, have agreed to a programme that will lead to net-zero targets in 2030. One of these initiatives propose an end to government support for new thermal coal generation capacity without CCS technologies.

This means that in the next 10 years, renewable energy will have to replace the production of these old traditional energy sources. This demand for change is putting a lot of pressure on FTSE-100 companies. However, with Ibstock already proposing and acting upon its net-zero roadmap, the future looks very bright for the sustainably focused brick manufacturer.

I believe that investing in this stock before the catalytic effects of ESG investing are wholly realised in the next decade could lead to great returns for me.

Our 5 Top Shares for the New “Green Industrial Revolution"

It was released in November 2020, and make no mistake:

It’s happening.

The UK Government’s 10-point plan for a new “Green Industrial Revolution.”

PriceWaterhouse Coopers believes this trend will cost £400billion…

…That’s just here in Britain over the next 10 years.

Worldwide, the Green Industrial Revolution could be worth TRILLIONS.

It’s why I’m urging all investors to read this special presentation carefully, and learn how you can uncover the 5 companies that we believe are poised to profit from this gargantuan trend ahead!

Access this special "Green Industrial Revolution" presentation now

John Town owns shares in Ibstock. The Motley Fool UK has recommended Ibstock. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our 6 'Best Buys Now' Shares

Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply click below to discover how you can take advantage of this.