Goldman Sachs says “green investments” will be “the main driver of global infrastructure over the next decade”. The firm shared its ideas on how to play the trend. According to Goldman, green investments — capital spending focused on sustainability goals such as decarbonization, infrastructure and clean water — will increase amid a boom in public and private sector investment. In a Tuesday note, Goldman said it believes “a holistic approach across all sectors is needed, providing opportunities across the Green Capex supply chain to participate in achieving these goals. To drive additional investments, we believe that three Cs will be required: Collaboration, Full Focus and Business Returns.” The company estimates $6 trillion in annual green investments over this decade, with an additional average of $2.8 trillion per year to support net zero, infrastructure and clean water goals. The firm selected buy-listed companies exposed to green decarbonization, infrastructure and clean water investment objectives that also met the following criteria: have favorable corporate financial returns relative to their peers have estimated revenue exposure Nations’ “Sustainable Development Goals” are not in the lower 20th percentile of GS Sustain’s “Environmental and Social” operational score. Palo Alto Networks are new additions to the company’s roster. Shares of cybersecurity solutions company Fortinet have jumped 37% since the start of the year. ESG funds are underweight the stock, according to analyst Gabriela Borges. About 70% of analysts covering Fortinet consider it a buy or strong buy, according to data from Refinitiv. Analysts’ consensus price target implies that shares could rebound almost 10%. Goldman also highlighted Palo Alto Networks. More than 80% of analysts covering the stock give it a buy or strong buy rating. Shares are up 41% in 2023. Electric vehicle maker Tesla also made Goldman’s list. Stocks had a strong year, rallying more than 37%. Analysts expect an additional upside of around 7% from current levels, according to data from Refinitiv. Finally, the firm appealed to the operator of cell towers IHS Holding. Shares have gained 47% in 2023. However, the stock is down nearly 10% over a 12-month period. — CNBC’s Michael Bloom contributed to this report.
