Invest with Greens or Sinners?

By Mary Brown,

I was sipping a soy latte after doing yoga on my recent eco-vacation and I started pondering a question: With the world turning “green”, wouldn’t it make sense to invest in green energy and divest from those evil, sinful companies? I gave it some serious thought and when I got home and, after I paid for my carbon offsets, I ran some numbers with some help from my hedge fund friends.

First, we identified publicly traded companies that operate in the renewable energy sector. I’ll call them the “Green Group”. We came up with these stocks…

Ascent Solar Technologies Inc

Ballard Power Systems Inc

Brookfield Renewable Partners

Canadian Solar Inc

Enphase Energy Inc

First Solar Inc

Gevo Inc

Green Plains Inc

JA Solar Holdings Co

Ocean Power Technologies Inc

Renesola Ltd

Renewable Energy Group Inc

SunPower Corp

Sunrun Inc

Vivint Solar Inc

Yingli Green Energy Holdings Co Ltd

Our second group we called “Sin Stocks”. These companies make chemicals and alcohol and guns and promote gambling. The list also includes defense stocks, “Big Pharma” and of course, the dreaded “Big Oil”. This list was bigger ….

Alliance One International Inc

Altria Group Inc

American Outdoor Brands Corporation

Anadarko Petroleum Corp

Anheuser-Busch InBev SA/NV

Archer-Daniels-Midland Co

Basic Energy Services Inc

Boston Beer Co Inc. (The)

Boyd Gaming Corp

BP PLC

British American Tobacco PLC

Caesars Entertainment Corp

Chevron Corp

Church & Dwight Co. Inc.

Coca-Cola Co (The)

Constellation Brands Inc

CoreCivic Inc

Craft Brew Alliance Inc

CV Sciences Inc

Diageo PLC

Dow Chemical Co (The)

E. I. du Pont de Nemours and Co

Eli Lilly and Co

Encore Capital Group Inc

Exxon Mobil Corp

FirstCash Inc

General Dynamics Corp

General Electric Co

Halliburton Co

Healthier Choices Management Corp

Las Vegas Sands Corp

Leucadia National Corp

Lockheed Martin Corp

McDonald’s Corp

MGM Resorts International

Molson Coors Brewing Co

Monsanto Co

Northrop Grumman Corp

Occidental Petroleum Corp

Oshkosh Corp

PepsiCo Inc

Pfizer Inc

Philip Morris International Inc

Phillips 66

Raytheon Co.

RCI Hospitality Holdings Inc

Schweitzer-Mauduit Intl Inc

Sturm Ruger & Co Inc.

Surna Inc

Syngenta AG, Basel

United Technologies Corp

Universal Corp

Valero Energy Corp

Vector Group Ltd

Western Alliance Bancorporation

World Acceptance Corp

Wynn Resorts Ltd

To compare the two groups, were ran stock performance back to Jan 1, 2008. That was our starting point because that is when there were enough Green stocks in the list to be significant. Also, it included the Great Recession. The graph below compares the Greens versus the Sinners with the S&P 500 plotted for good measure. Starting with $100 in each group, the Sinners finished with $245, the S&P with $168 and the Greens had $20. Being a sinner was 12 times more profitable.

Conclusion: People love to “sin”. It’s a good idea to invest in the companies that service them.

Notes… Not all stocks were included due to liquidity screens. Past performance is not indicative of future results. Airplanes may or may not be moved before 20 feet of sea level occurs.