Responsible investing: a stock I might buy for the ‘green revolution’

The idea of responsible investing is becoming increasingly important to stock investors. Here’s one share I’d happily buy as ESG investing accelerates.

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.

potted green plant grows up in arrow shape

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Studies show that responsible investing is becoming more and more important to people. The good news is that there are plenty of so-called green stocks for people to choose to invest in. And the number continues to grow. Right now UK and US share pickers can get exposure to renewable energy, the recycling industry, electric car manufacturing… The list is huge.

At the moment there are few options for those seeking green stocks that operate in the lab-grown meat sector. However, I think US share Tyson Foods (NYSE: TSN) could be a good way to get exposure to this fast-growing food segment. The food giant is one of several blue chips and venture capital funds that have invested in cultured meat manufacturer Future Meat Technologies.

This cutting-edge food producer just raised $26.8m, in fact, to boost production and accelerate research and development. Investment in the world of lab-produced meat is heating up as the size of its potential customer base becomes more apparent. A recent report by scientific journal Foods suggested that 80% of US and UK citizens would be tempted to try vat-grown meat (half of which said that they were “highly likely” to try it). The upside for Tyson Foods could therefore be huge.

Rewards vs risk

The popularity of vegetarian and vegan diets is soaring for various reasons. Aside from issues surrounding animal welfare, concerns over the quantity of greenhouse gases that livestock herds emit is also turning people off meat. As well, worries over how much water and land that pastoral farming requires compared with what arable farming needs is also causing people to seek more nature-friendly alternatives.

It’s worth remembering that the lab-grown meat industry is still in its infancy. Thus it’s too early to claim that Future Meat Technologies could be on the road to riches. As for Tyson Foods itself, this US share is one of the biggest producers of chicken, pork, and beef on the planet. It could turn out that the business cannibalises its core operations by pushing into the cultured and plant-based meat segments.

A green stock of the future?

Still, in the long term, Tyson’s plan to become a market leader in the lab-grown meat segment could pay off handsomely. Analysts at AT Kearney predicted two years ago that 60% of all meat won’t come from animals by 2040. Instead it will come from the lab bench or be replaced by plant-based alternatives.

I believe the growing popularity of non-meat diets in the wake of Covid-19 could see demand for lab-produced meat grow at an even faster rate, too. Mintel data shows that that 25% of Brits aged between 21 and 30 years now find a vegan diet more appealing than they did prior to Covid-19. Tyson Foods is trying to stay ahead of the curve by dipping its toe in the artificial meat industry. I think it’s a plan that could deliver big shareholder returns in the years ahead.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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.

More on Investing Articles

Bus waiting in front of the London Stock Exchange on a sunny day.
Investing Articles

If interest rate cuts are coming, I think these UK growth stocks could soar!

Falling interest could be great news for UK growth stocks, especially those that have been under the cosh recently. Paul…

Read more »

Investing Articles

Are these the best stocks to buy on the FTSE right now?

With the UK stock market on the way to hitting new highs, this Fool is considering which are the best…

Read more »

Petrochemical engineer working at night with digital tablet inside oil and gas refinery plant
Investing Articles

Can the Centrica dividend keep on growing?

Christopher Ruane considers some positive factors that might see continued growth in the Centrica dividend -- as well as some…

Read more »

Smiling family of four enjoying breakfast at sunrise while camping
Investing Articles

How I’d turn my £12,000 of savings into passive income of £1,275 a month

This Fool is considering a strategy that he believes can help him achieve a stable passive income stream with a…

Read more »

Person holding magnifying glass over important document, reading the small print
Investing Articles

2 top FTSE 250 investment trusts trading at attractive discounts!

This pair of discounted FTSE 250 trusts appear to be on sale right now. Here's why I'd scoop up their…

Read more »

Smiling young man sitting in cafe and checking messages, with his laptop in front of him.
Investing Articles

3 things that could push the Lloyds share price to 60p and beyond

The Lloyds share price has broken through 50p. Next step 60p? And then what? Here are some thoughts on what…

Read more »

Young female business analyst looking at a graph chart while working from home
Investing Articles

£1,000 in Rolls-Royce shares a year ago would be worth this much now

Rolls-Royce shares have posted one of the best stock market gains of the past 12 months. But what might the…

Read more »

Investing Articles

Are HSBC shares a FTSE bargain? Here’s what the charts say!

There are plenty of dirt-cheap FTSE 100 banking stocks for investors to choose from today. Our writer Royston Wild believes…

Read more »