In this article, we discuss the 9 stock picks of ESG investor Jeffrey Ubben. If you want to skip our detailed analysis of these stocks, go directly to the 4 Stock Picks of ESG Investor Jeffrey Ubben.
Environmental, social, and governance (ESG) concerns have become a key focus of investors as they seek to identify winners at the stock market. Impact investing — traditionally defined as investments that aim to generate an environmental, social, or governance impact in addition to a financial gain — are now all the rave on Wall Street. This is perhaps why Jeffrey Ubben, the co-founder of ValueAct Capital, one of the most successful hedge funds in the world, recently left his position as chief of ValueAct to pursue a career in impact investing with Inclusive Capital.
Latest 13F filings show that Inclusive Capital had a portfolio value of over $915 million at the end of September 2021, down from $1 billion at the end of the second quarter. Between June and September, the fund made additional purchases in 3 stocks and sold out of 1 stock. Presently, the portfolio comprises just nine companies. The fund is working with several companies to improve ESG practices in the corporate workplace. Ubben has a personal net worth of $80 million.
In 2020, when announcing that he would be leaving ValueAct to focus solely on ESG investing, Ubben told investors in a letter that he aimed to “partner with management and the boards of companies whose core businesses seek to achieve the reversal of corporate harm”. ValueAct had a portfolio value of $16 billion when Ubben decided to leave, a glowing testament to the success of the impact investor who had only founded the firm back in 2000. Investors keen for an entry into ESG investing should check out some top ESG stocks.
Some of the top ESG stocks to buy right now include Microsoft Corporation (NASDAQ:MSFT), Alphabet Inc. (NASDAQ:GOOG), and PayPal Holdings, Inc. (NASDAQ:PYPL), among others discussed in detail below.
Our Methodology
The stocks were picked from the third quarter regulatory filings of Inclusive Capital. All the companies in which the fund presently holds a stake feature on the list.
The hedge fund sentiment around each stock was calculated using the data of 867 hedge funds tracked by Insider Monkey.
Jeffrey Ubben, Founder of ValueAct Capital and Inclusive Capital Partners
Stock Picks of ESG Investor Jeffrey Ubben
9. Enviva Partners, LP (NYSE:EVA)
Number of Hedge Fund Holders: 8
Enviva Partners, LP (NYSE:EVA) makes and sells utility grade wood pellets. The company has an impressive dividend history and recently declared a quarterly dividend of $0.84 per share, an increase of more than 3% from the previous dividend of $0.81 per share. The forward yield was 4.95%.
Latest data shows that Inclusive Capital owned 5.7 million shares of Enviva Partners, LP (NYSE:EVA) at the end of the third quarter of 2021 worth $309 million, representing 33.75% of the portfolio.
At the end of the third quarter of 2021, 8 hedge funds in the database of Insider Monkey held stakes worth $341 million in Enviva Partners, LP (NYSE:EVA), down from 9 the preceding quarter worth $335 million.
Just like Microsoft Corporation (NASDAQ:MSFT), Alphabet Inc. (NASDAQ:GOOG), and PayPal Holdings, Inc. (NASDAQ:PYPL), Enviva Partners, LP (NYSE:EVA) is one of the stocks on the radar of elite investors.
8. Verra Mobility Corporation (NASDAQ:VRRM)
Number of Hedge Fund Holders: 25
Verra Mobility Corporation (NASDAQ:VRRM) provides smart mobility technology solutions. According to regulatory filings, Inclusive Capital owned 8.8 million shares in the company at the end of September 2021 worth $134 million, representing 14.64% of the portfolio.
Verra Mobility Corporation (NASDAQ:VRRM) recently posted earnings for the third quarter, reporting earnings per share of $0.27, beating estimates by $0.16. The revenue over the period was $162 million, up 67% year-on-year.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Scopia Capital is a leading shareholder in Verra Mobility Corporation (NASDAQ:VRRM) with 6.8 million shares worth more than $103 million.
7. Nikola Corporation (NASDAQ:NKLA)
Number of Hedge Fund Holders: 12
Nikola Corporation (NASDAQ:NKLA) markets new energy transportation solutions. The stock has benefited from the successful passage of a recent infrastructure bill that includes key tax incentives for new energy vehicle makers and American manufacturers in general for the long-term in a bid to jumpstart EV adoption and the economy.
The hedge fund of Jeffrey Ubben owned 10.2 million shares of Nikola Corporation (NASDAQ:NKLA) at the end of the third quarter of 2021 worth more than $109 million, representing 11.97% of the total portfolio.
Among the hedge funds being tracked by Insider Monkey, San Francisco-based firm Inclusive Capital is a leading shareholder in Nikola Corporation (NASDAQ:NKLA) with 10 million shares worth more than $185 million.
In its Q4 2020 investor letter, Bireme Capital, an asset management firm, highlighted a few stocks and Nikola Corporation (NASDAQ:NKLA) was one of them. Here is what the fund said:
“Nikola Corporation (NKLA) is a poor-man’s facsimile of Tesla. Even the name is a blatant ripo: both are named aer the inventor Nikola Tesla. NKLA is a pre-revenue company founded in 2014 that has yet to bring a product to market, despite the promotion of a dizzying array of concepts:
Nikola Badger: pickup with both fuel-cell and electric variants
Nikola One: fuel-cell commercial semi-truck
Nikola Two: fuel-cell commercial semi-truck
Nikola Tre: electric commercial semi-truck
Nikola NZT: electric four-wheel drive utility vehicle
Nikola Reckless: electric military grade o-highway vehicle
Nikola WAV: electric watersports vehicle
As far as we can tell from their latest investor communications, only the Nikola Tre Commercial semitruck is still in development.
As far as we can tell from their latest investor communications, only the Nikola Tre Commercial semitruck is still in development. NKLA’s history is full of deception and vaporware. They showed a video of the Nikola One in motion; they later admitted that it didn’t work and was just rolling down a hill. NKA’s founder Trevor Milton resigned in disgrace aer Hindenburg Research published a report calling NKLA an “intricate fraud.” NKLA is currently under investigation by both the SEC and DoJ. Partnerships with GM, Republic Services and BP have been canceled. Nevertheless, the company sports an $8b market cap, because “electric vehicles.” Though pretenders are particularly ubiquitous in the bubbly EV industry, pretenders are to be found in many other industries as well.”
6. PotlatchDeltic Corporation (NASDAQ:PCH)
Number of Hedge Fund Holders: 22
PotlatchDeltic Corporation (NASDAQ:PCH) is a real estate investment trust based in Washington. DA Davidson analyst Kurt Yinger recently upgraded the stock to Buy from Neutral and raised the price target to $61 from $60, noting that the valuation of the firm offered an attractive entry point for investors.
Inclusive Capital owned 259,846 shares in PotlatchDeltic Corporation (NASDAQ:PCH) at the end of September 2021 worth $13.4 million, representing 1.46% of the portfolio.
At the end of the third quarter of 2021, 22 hedge funds in the database of Insider Monkey held stakes worth $85 million in PotlatchDeltic Corporation (NASDAQ:PCH), down from 28 in the preceding quarter worth $112 million.
In its Q1 2021 investor letter, Longleaf Partners Fund highlighted a few stocks and PotlatchDeltic Corporation (NASDAQ:PCH) was one of them. Here is what the fund said:
“We exited two businesses in the period (which includes) PotlatchDeltic. In both cases, share price went above our appraised value, even though we continue to view the businesses and management teams highly and hope to have the opportunity to partner with them again. We have owned the assets at PotlatchDeltic successfully four times now in the last two decades and have great respect for the management team.”
5. Exxon Mobil Corporation (NYSE:XOM)
Number of Hedge Fund Holders: 68
Exxon Mobil Corporation (NYSE:XOM) is an integrated oil and gas firm. Even though the stock has benefited from a record surge in oil prices over the past few months, there are signs that the rally might be slowing down as the US plans to release oil from strategic reserves to meet demand and a COVID-19 lockdown in Austria batters travel in Europe.
Latest securities filings reveal that Inclusive Capital owned 1.6 million shares in Exxon Mobil Corporation (NYSE:XOM) at the end of the third quarter of 2021 worth $98 million.
At the end of the third quarter of 2021, 68 hedge funds in the database of Insider Monkey held stakes worth $3.6 billion in Exxon Mobil Corporation (NYSE:XOM), up from 65 in the preceding quarter worth $2.7 billion.
Along with Microsoft Corporation (NASDAQ:MSFT), Alphabet Inc. (NASDAQ:GOOG), and PayPal Holdings, Inc. (NASDAQ:PYPL), Exxon Mobil Corporation (NYSE:XOM) is one of the stocks attracting the attention of hedge funds.
In its Q1 2021 investor letter, Harding Loevner highlighted a few stocks and Exxon Mobil Corporation (NYSE:XOM) was one of them. Here is what the fund said:
“We felt that our remaining energy holding, ExxonMobil, with its stronger balance sheet, was in a better position to ride out the cyclical slump in oil demand and even perhaps take advantage of it by investing counter-cyclically. While ExxonMobil does plan to increase capital expenditure, we’ve been disappointed in its regrettable failure to address ongoing emission trends, which reflects poorly on management’s foresight. As a result, we sold our ExxonMobil holdings.”
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Disclosure. None. 9 Stock Picks of ESG Investor Jeffrey Ubben is originally published on Insider Monkey.
