What is a Green Stock? - Cabot Wealth Network

What is a Green Stock?

Investor interest in Greentech is at all-time highs, but how does Cabot SX Greentech Advisor classify something as a "green stock?"

Solar and wind both fall under the category of green stock

Cabot SX Greentech Advisor takes Cabot’s stock picking and market timing system and applies it to earth-friendly investments. As a sector, Greentech offers the most profit potential since the Internet boom of the mid-1990s, and Cabot’s system ferrets out the best stocks to own and profit from, but how does the advisory determine what constitutes a Green stock?

Brendan Coffey, a veteran financial journalist, is the Chief Analyst of Cabot SX Greentech Advisor. Brendan has spent more than two decades writing about investments for publications including Barron’s, Forbes, the Wall Street Journal and a number of private-client brokerage newsletters.

With earth-friendly investing growing into its own, Brendan draws upon insights gleaned from covering everything from renewable energy, EVs, water, infrastructure and other green stocks and filters it through Cabot’s proven system for identifying and capitalizing on fast-growing stocks.

Selecting the Stocks

Cabot has spent over 50 years honing a stock picking and market timing system that uncovers leading stocks in some of the fastest growing sectors. Cabot SX Greentech Advisor applies this system to environmentally friendly investments, which just happen to possess some of the most exciting growth prospects of any sector in the market.

Many of Brendan’s recommendations are young and their stories are often unknown, giving them bigger upside potential as the big-money crowd accumulates positions. The demand for alternative energy is growing all the time, along with demand for Green building practices and Green technology. This is only going to increase in the future and Cabot SX Greentech Advisor will be on top of these trends, selecting the best stocks for subscribers.

Cabot SX Greentech Advisor looks for promising companies benefiting from the global trend for Green products and services. To qualify as a potential recommendation, a large part of the company’s growth must be the result of a Green business arm, product or innovation.

Companies featured in the Cabot SX Greentech Advisor also meet our strict fundamental and technical criteria. Our recommended companies almost always possess rapid sales and earnings growth, huge margins and the potential for continued growth down the road. Most important, the stocks of our companies are in solid uptrends, telling us that the aforementioned big-money crowd is indeed buying shares.

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Once the Cabot SX Greentech Advisor owns a stock, it will be held for as long as the stock performs well. Our goal is to hold green stocks for the long term. But we let the stocks tell us when they should be sold, applying the same time-tested proprietary tools that we’ve developed and refined for 50+ years..

Specifically, we pay close attention to each stock’s chart. Is the stock in a solid uptrend? Does trading volume show accumulation? Are corrections brief and shallow? We judge a stock’s health using traditional technical analysis tools—trendlines, support/resistance, etc.—relative performance and volume analysis. Using those tools, we’ll also identify stop-loss levels to serve as exit prices in order to minimize losses should a position move against us.

What is a Green Stock?

Many people ask us, “What is a Green stock?” Good question. Green stocks are those leading the trend toward environmentally friendly ends, be they new sources of clean energy, products that mitigate the environmental impact and energy cost of existing technologies or those that profit from the increasing move by consumers to organic and efficient products. Cabot SX Greentech Advisor follows a universe of 200+ stocks and actively screens for new additions arising from SPAC acquisitions, IPOs, or fundamental company-specific changes.

We’re looking to capitalize on trends, not to make value judgments, so we approach the stocks solely as investors. That said, we also monitor companies for environmental, social and governance (ESG) factors and highlight the best stocks in our ESG Three. If the fundamentals are poor, the trend is bad or a company is overvalued, then it’s a poor stock to buy now, regardless of how we may feel personally about the product or service.

What doesn’t change is that Cabot SX Greentech Advisor looks for promising companies benefiting from the Green trend.

A subscription to Cabot SX Greentech Advisor includes twice-monthly issues, updates in off weeks, and detailed buy and sell instructions and special alerts any time there is important news on the markets or one of our stocks. Subscribers also get email access to the Chief Analyst, Brendan, and access to subscriber-only special reports.

Cabot SX Greentech Advisor can help you get on board early in this fast-growing area.

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*This post has been updated from a previously published version.

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