In a fast-changing world the companies that will survive and thrive are those that make the world a more sustainable place. We look for businesses that improve people’s quality of life through medical, technological or educational advances; drive improvements in the efficiency with which we use increasingly scarce resources; or help build a more stable, resilient and prosperous economy.
We want investors to be able to generate strong returns while benefiting society. This can be done by identifying long-term transformations such as technological and medical advances and investing in companies exposed to powerful trends.
Smurfit Kappa: cutting waste in paper and packaging
Smurfit Kappa (LSE: SKG) is one such business. Paper and packaging companies are at the centre of the waste debate and we see strong financial and environmental opportunities for those that can operate sustainably. Three-quarters of the fibres that Smurfit Kappa uses are from recycled sources and the remaining 25% come directly from its own plantations and third-party suppliers. We see value in Smurfit Kappa’s responsible resource management, operational efficiency and products that help to reduce waste, use fewer resources as well as increase recyclability, reusability and degradability. CEO Anthony Smurfit has said that consumers are increasingly demanding sustainable packaging and with its expertise in paper-based packaging, the company is ideally positioned to take advantage of this mega-trend.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Software might not be the first sector you think of when mulling sustainable stocks. But Autodesk (Nasdaq: ADSK) offers an opportunity. It brings technology to the construction sector, which had previously relied on paper and sketches. Its software reduces errors in construction, saving time and vital resources, and makes the overall construction industry more efficient.
Autodesk has fared well in spite of fears that demand for its technology is vulnerable to a slowing global economy and construction market. While the construction industry remains cyclical, the secular nature of the growth in technology adoption should ensure strong compound growth over many years to come.
A healthy outlook for IQVIA
Finally, I’d point to IQVIA (NYSE: IQV), which has a market value of $30bn. In the UK we spend 9% of GDP on healthcare; in the US the figure is 18%. This spending is expected to grow by 6% a year for the next decade, so we know there is a need for innovation in this sector. This can easily be demonstrated by looking at drug trials. For a pharmaceutical company aiming to distribute a new drug, creating it is just the start of the story. Trials are compulsory and there are usually at least three phases.
Costs can run to $400m per phase, with the expense even greater when trials run over; they are also difficult to recruit for. IQVIA has data on prescriptions, the software to design, plan and monitor drug trials and allows companies to run these important events in a more effective manner. It’s a sustainable company because it enables better patient outcomes via innovation, but it’s also a firm with good revenue growth, good management, and good business fundamentals. There is plenty of upside for this stock.
-
10 vinyl records worth up to £10,000 - is one in your collection?News Vinyl is experiencing a resurgence and collectors will pay up to £10,000 for some albums - is it time to dust off your old records?
-
FCA: Banks are still short-changing savers
The latest FCA review finds that while public shaming has encouraged providers into offering better deals on savings, many of those with closed accounts are still being shortchanged.
-
Halifax: House price slump continues as prices slide for the sixth consecutive month
UK house prices fell again in September as buyers returned, but the slowdown was not as fast as anticipated, latest Halifax data shows. Where are house prices falling the most?
-
Rents hit a record high - but is the opportunity for buy-to-let investors still strong?
UK rent prices have hit a record high with the average hitting over £1,200 a month says Rightmove. Are there still opportunities in buy-to-let?
-
Pension savers turn to gold investments
Investors are racing to buy gold to protect their pensions from a stock market correction and high inflation, experts say
-
Where to find the best returns from student accommodation
Student accommodation can be a lucrative investment if you know where to look.
-
Best investing apps
We round up the best investing apps. Looking for an easy-to-use app to help you start investing, keep track of your portfolio or make trades on the go?
-
The top funds to invest in
Tips Investors put Scottish Mortgage Investment Trust back on top, and India is the new investment hotspot - We look at what investors have been adding to their portfolios in the last month
-
The world’s best bargain stocks
Searching for bargain stocks with Alec Cutler of the Orbis Global Balanced Fund, who tells Andrew Van Sickle which sectors are being overlooked.
-
Revealed: the cheapest cities to own a home in Britain
New research reveals the cheapest cities to own a home, taking account of mortgage payments, utility bills and council tax
