Top Stocks to Make You Green
By
Rich Duprey
April 22, 2008
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Want to keep the planet and your portfolio green? The Fool shows you how in our special series on Earth-friendly investing.
Does the investor-intelligence community at Motley Fool CAPS know something the rest of us don't about making green(backs) while being green? Perhaps.
Twenty-one companies have earned the tag "environmentally friendly" on CAPS, from agricultural giant Archer Daniels Midland (NYSE: ADM) to development-stage geothermal-energy producer U.S. Geothermal.
Slightly more than half of them, however, have garnered a favorable three-star-or-better CAPS rating from our community of 97,000-plus green-thumb investors. On average, those top 11 companies have returned 6.9% since Earth Day last year, while the market -- as represented by the S&P 500 index -- has fallen more than 6% in the same time.
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Company
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CAPS Rating (Out of 5)
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1-Year Total Return
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Archer Daniels Midland
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****
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22.1%
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Echelon
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***
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6.7%
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Energy Conversion Devices (Nasdaq: ENER)
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****
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(9.5%)
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Evergreen Solar (Nasdaq: ESLR)
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***
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(7.9%)
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Orion Energy Systems
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****
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(44.4%)
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PowerShares WilderHill Clean Energy
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****
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9.4%
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SunPower (Nasdaq: SPWR)
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***
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61.1%
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Suntech Power (NYSE: STP)
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*****
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36.7%
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U.S. Geothermal
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*****
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54.4%
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Whole Foods Market (Nasdaq: WFMI)
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***
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(26.8%)
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Zoltek (Nasdaq: ZOLT)
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***
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(25.7%)
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Average total return
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6.9%
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S&P 500
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(6.3%)
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Sources: Yahoo! Finance and Motley Fool CAPS. Returns calculated between 4/20/07 and 4/18/08.
Those returns would have been even better if we focused solely on the top-rated four- and five-star stocks. These six environmentally friendly companies returned an average of 11.4% over the past year, and CAPS investors think they have more room to run.
The future's so bright
More than 3,000 investors have rated Suntech Power, and 96.7% continue to believe it will outperform the S&P500 going forward. For instance, CAPS investor bullbeater2007 sees a number of trends that will push this Motley Fool Rule Breakers recommendation and the rest of the solar industry higher:
[P]olysilicon prices coming down. ... Oil, natural gas, commodity and overall demand at record high. ... Beijing Olympics- China setting lofty goal on alternative energy and will try to show the world [its] progress .... Europe is rapidly adapting solar power (first Germany, now Spain). ... Global warming is not a hoax and eventually people will realize the intangible cost of fossil fuels[.]
A Foolish takeaway
It's not always easy being green, and it can be even harder to make some green in your portfolio with stocks that profess to love the planet. However, using CAPS to help plant a tree of growth in your portfolio this Earth Day could help your profits bloom in years to come. Head over to the completely free Motley Fool CAPS and give us your opinion on these environmentally friendly companies that have the power to make your friends green with envy.
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