Goldman Sachs says “green capital investment” will be “a major driver of global infrastructure in the next decade.” The company shared its ideas on how to address this trend. According to Goldman, green capital spending (capital spending towards sustainability goals such as decarbonization, infrastructure and clean water) will surge amid an investment boom in the public and private sectors. Goldman said in a note Tuesday that it believes “a cross-sector, all-in approach is needed, offering the entire green capital investment supply chain the opportunity to participate in meeting these goals.” . He believes the three C’s will be needed to stimulate additional investment. Comprehensive focus and corporate interests. The company estimates there will be $6 trillion in green capex annually over this decade, with an average annual increase of $2.8 trillion to support net zero, infrastructure and clean water goals. The company screened buy-evaluated companies that are exposed to green capex goals such as decarbonization, infrastructure, and water, and also meet the following criteria: Generate favorable corporate financial returns compared to peers. At least 25% estimated revenue exposure to green capex related United Airlines countries’ Sustainable Development Goals are not in the bottom 20th percentile of the company’s GS Sustain-operated Environmental & Social scores Goldman Sachs The 10 names highlighted as potential winners in green capex are: Tech companies Check Point, Fortinet, Microsoft and Palo Alto Networks are new additions to the company’s list. Fortinet, a cybersecurity solutions company, has surged 37% since the start of the year. ESG funds are underweight equities, according to analyst Gabriela Borges. About 70% of analysts covering Fortinet rate the company a “buy” or a “strong buy,” according to Refinitiv data. Analysts’ consensus price target suggests the stock could rise nearly 10%. Goldman also highlighted Palo Alto Networks. More than 80% of analysts covering the stock give it a Buy or Strong Buy rating. The stock will rise 41% in 2023. Electric car maker Tesla also made the Goldman list. The stock has had a strong year, up more than 37%. Analysts see a further upside of about 7% from current levels, according to Refinitiv data. Finally, the company turned to mobile phone base station operator IHS Holding. The stock price he’s up 47% in 2023. However, the stock has fallen almost 10% in his 12 months. — CNBC’s Michael Bloom contributed to this report.
