I’m looking for ways to save the planet. And I’m seeking to make a pot of cash in the process. Fortunately there are plenty of UK and US shares to help me do this. Beyond Meat (NASDAQ: BYND) is one I’m thinking of adding to my Stocks and Shares ISA. But it’s not the only ‘green’ stock I’m thinking of buying soon.
Profits poised to flow
The growing importance of responsible water usage makes Water Intelligence (LSE: WATR) a great UK share for the next decade, I feel. Why? The company is involved in the detection, finding and fixing water leaks for residential, commercial and municipal customers. And boy is business booming. Revenues here rose 38% in the three months to March. I expect demand for its services to keep booming as the climate crisis worsens too.
The rise of responsible investing is turbocharging demand for so-called ethical investments like Water Intelligence shares. According to Close Brothers Asset Management, a hefty 65% of 2,000 investors it surveyed said that they “prioritise responsible investing over a desire to ‘simply maximise’ their financial return”. Rising concerns over the environment bodes well for this UK share, then, a holder of the London Stock Exchange’s ‘Green Economy Mark’.
It’s worth remembering, though, that Water Intelligence carries a hefty valuation at current prices. City analysts expect the firm’s earnings to rise 13% in 2021. And this leaves the company trading on a forward price-to-earnings (P/E) ratio of 59 times. Such a lofty reading could prompt a sharp share price reversal if the company experiences any distress.
A look at Beyond Meat
As I said earlier, I think Beyond Meat is a great ‘green’ share to buy today. A rising focus on animal welfare is one reason why vegan and vegetarian diets are popular. Concerns over the impact of livestock farming on greenhouse gas levels are also driving people away from animal-based foods.
These issues explain why demand for Beyond Meat’s non-meat products is flying. Latest financials showed net revenues at the company soared 11.4% in the three months to March. This may have missed expectations but that sort of growth is still impressive given that its foodservice operations continued to suffer from Covid-19-related pressures. Beyond Meat is spending heavily so that it can play a big part in the meat-free revolution. As it said last week, it has remained “highly focused on investing in and building out production infrastructure in the US, the EU, and China” in recent months.
That’s not to say that Beyond Meat (like any share) doesn’t have its problems. The company has a giant $1.1bn net debt mountain, which could constrain its growth plans. This is particularly high in relation to the foodie’s sales today (net revenues were a shade over $108m in the first quarter). Still, I think this US share’s market-leading position in a fast-growing marketplace makes it an attractive buy right now.
Royston Wild has no position in any of the shares mentioned. The Motley Fool UK owns shares of and has recommended Beyond Meat, Inc. 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.