The wind energy park “Odervorland” in the Oder-Spree district of Brandenburg, Germany.
Patrick Pleul | photo alliance | Getty Images
Stocks related to the theme of “green transformation” have been hit so far this year, but a stock strategist is backing some of them for the long term.
It comes after a massive increase in green energy supplies in 2020, when oil and gas companies suffered from the declining demand caused by the pandemic. But the tables have turned so far this year.
“Our guess is that investors are starting to calibrate their views on the green transformation and wonder if they are overpaying for future growth,” Peter Garnry, Saxo Bank’s head of equity strategy, said in a note to investors earlier this month.
At the time, Saxo Bank’s basket of 40 shares of ‘green transformation’ – including household names like Tesla – fell 9.1% so far in 2021, posting the worst performance among the Danish investment bank’s stock themes.
The broad downward move continued, with the majority of green stocks falling last week as global markets saw another swing from inflation fears.
Despite this, Garnry remains optimistic about the sector for a number of important reasons.