With greater interest in “going green,” investors have enjoyed a variety of new opportunities for wealth creation. You’ve likely surveyed these options and seen the potential in solar energy systems, fuel-cell technology, sustainable fishing and similar endeavors. Green building practices have special appeal.
As the practice of green building rises in popularity, construction companies across the United States started to adapt their outdated methods. They reduced their carbon emissions and eliminated waste, improving their sustainability under the pressures of environmental regulations and public attention.
In this transition, construction companies have also embraced the use of green building components. In doing so, they decreased their dependence on harmful materials and increased their investment in eco-friendly alternatives. Naturally, these changes benefit progressive investors looking to build their portfolio.
Of course, you shouldn’t select the first company that has an association with green building. You have to take a strategic approach, choosing the green building stocks that show significant potential. To that end, this article will serve as a resource to guide you in the right direction, providing the top stocks of 2019.
Nothing is a guarantee, of course, and risk is an inherent element in every investment. Even so, you should review these five options for your portfolio. In the coming decade, the interest in “going green” will only continue to grow, and you can take advantage of these trends with the following stocks.
1. Johnson Controls International PLC
Johnson Controls provides a diverse range of tech-driven solutions for building efficiency and similar purposes. With their experience in building-related equipment — and their mission to create “a smart future” for facilities — they represent an excellent option for investors searching for green building stocks.
Concerning the expected earnings, their EPS forecast for this quarter shows $0.65 with a P/E ratio of 15.3. Johnson Controls pays a quarterly dividend of $0.26 per common share. Their earnings growth last year was +35.78%, and their projected earnings growth over the next five years is +8.50%.
Clearly, Johnson Controls International PLC has significant promise within the context of current trends. Their management technologies will prove valuable to building managers as they improve sustainability in their facilities. Needless to say, energy efficiency will remain relevant well into the next decade.
2. Honeywell International Inc.
Honeywell International Inc. is a multinational conglomerate company and a leader in building climate control. That said, building automation and control represents only around a third of their sales. They also have aerospace, materials and transportation segments beyond their focus on green building.
Concerning the expected earnings, their EPS forecast for this quarter shows $2.07 with a P/E ratio of 18.9. Honeywell International Inc. pays a quarterly dividend of $0.82 per common share. Their earnings growth last year was +319.35%, and their projected earnings growth over the next five years is +7.47%.
As for the value of Honeywell International Inc., climate control is one of the essential elements of green building. Similar to Johnson Controls, the regulation of a building’s interior temperature is an energy-intensive task. Improved technologies from Honeywell will likely prove important for reducing energy usage.
3. Brookfield Infrastructure Partners LP
Similar to Johnson Controls and Honeywell, Brookfield Infrastructure Partners LP has a focus on energy usage. They’ve identified energy efficiency as a crucial driver of long-term growth, and they hope to improve sustainability and combat the escalating threat of climate change through their infrastructure assets.
Concerning the expected earnings, their EPS forecast for this quarter shows $0.36 with a P/E ratio of 343.7. BIP pays a quarterly dividend of $0.5025 per common share. Their earnings growth last year was +1,263.25%, and their projected earnings growth over the next five years is +9.59%.
As for alternative options in the same area of investment, you have a range of stocks and funds to select from. For example, 40% of the new international micro-cap fund from Brookvine covers relevant areas like green energy, e-commerce, connectivity, health and wellness, data analytics and cybersecurity.
4. PFB Corporation
PFB Corporation manufactures and sells proprietary insulating building products that use expanded polystyrene. The company operates in both Canada and the United States, selling EPS products, structural insulating panels, building systems and similar tools. Their primary focus is on green building.
Concerning the expected earnings, their EPS forecast for this quarter shows $0.70 with a P/E ratio of 10.44. PFB Corporation pays a quarterly dividend of $0.07 per common share. Their earnings growth this year is 10.90%, and their projected earnings growth over the next year is 17.60%.
In terms of PFB Corporation’s potential, the increasing demand for alternative building materials will likely continue into the next decade. Among other green building materials, it’s safe to speculate that PFB Corporation’s expanded polystyrene and similar eco-friendly insulators will see greater adoption.
5. LSB Industries Inc.
LSB Industries Inc. is a chemical and GHP manufacturer with a stake in green building practices. Around a third of its revenue comes from its climate control technologies, which, as mentioned earlier, represent an essential element of green building in terms of energy efficiency and the reduction of carbon emissions.
Concerning the expected earnings, their EPS forecast for this quarter shows -$0.09 with an unavailable P/E ratio. LSB Industries does not pay a dividend. Though LXU doesn’t appear promising, their earnings growth this year was +42.78%, and their projected earnings growth over the next five years is +10.00%.
Investors should give thought to LSB Industries Inc. for its present and future relevance to green building practices. Though it may seem somewhat unappealing next to the other options on this list, its earnings growth this year and projections show it’s still an option deserving of consideration.
An Investment in the Future
As you review green building stocks for your portfolio, consider the five companies above. Each has significant potential in 2019 and the next decade, so research these options in greater detail and determine which of them works best for your current goals.
Whether you choose to invest in Johnson Controls, PFB Corporation, LSB Industries or another, similar option, you’ll see that wealth creation and environmental conservation are one and the same.