In this article, we discuss the 5 best ESG stocks to buy now. If you want to read our detailed analysis of these companies, go directly to the 10 Best ESG Stocks to Buy Now.
5. Salesforce.com, Inc. (NYSE: CRM)
Number of Hedge Fund Holders: 91
Salesforce.com, Inc. (NYSE: CRM) stock has offered investors returns exceeding 28% over the course of the past twelve months. It is ranked fifth on our list of 10 best ESG stocks to buy now. The company markets enterprise-level cloud computing solutions, primarily for client management. The New York-based finance firm, MSCI, has a AAA ESG rating on the cloud computing firm.
On June 29, Salesforce.com, Inc. (NYSE: CRM) announced that it was planning to raise money through a debt sale in order to help the firm pay for the purchase of work-related software firm Slack Technologies. The firm had purchased Slack for over $27 billion late last year.
Out of the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Salesforce.com, Inc. (NYSE: CRM) with 12.9 million shares worth more than $2.7 billion.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Salesforce.com, Inc. (NYSE: CRM) was one of them. Here is what the fund said:
“We added to our software-as-a-service (SaaS) exposure with the initiation of SaaS leader salesforce.com, which develops software for customer relationship management (we added Workday, which enterprise resource planning applications, last quarter). Saleforce.com is well-positioned in the most attractive end markets in software and will benefit from secular drivers such as remote work and the digital transformation. Salesforce.com is a sustainability leader as well, with a commitment to carbon-neutral cloud, toward which it has set a goal of 100% renewable energy for global operations by fiscal year 2022. The company has a strong focus on equality, in terms of equal rights, pay, education and opportunity. As a data company it has been leading on workforce disclosures and seeks to have 50% of its U.S. workforce made up of underrepresented groups by 2024.”
4. Adobe Inc. (NASDAQ: ADBE)
Number of hedge fund holders: 107
Adobe Inc. (NASDAQ: ADBE) is placed fourth on our list of 10 best ESG stocks to buy now. The stock has returned more than 34% to investors in the past year. The company makes and sells different types of software for creative professionals around the world. It is one of the most sustainable companies in the world due in part to the nature of the business. MSCI has an ESG rating of AA for the company.
On June 18, investment advisory MIzuho maintained a Buy rating on Adobe Inc. (NASDAQ: ADBE) stock with a revised price target of $640 from $600, underlining the digital media growth of the firm as a major growth catalyst in the near-term future.
Out of the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Adobe Inc. (NASDAQ: ADBE) with 5.9 million shares worth more than $2.8 billion.
Here is what Polen Capital has to say about Adobe Inc. (NASDAQ: ADBE) in its Q1 2021 investor letter:
“Adobe and Autodesk are both prime examples of the rotation that occurred during the quarter. Both are dominant businesses in their respective markets, which are experiencing structural tailwinds. Despite each business’s position of strength, the stocks of cyclicals and businesses with higher leverage and lower profitability were more favored this past quarter. In stark contrast, Adobe and Autodesk both have low leverage, high levels of profitability, high recurring revenues that mitigate cyclicality, and are both capital-light business models—all attributes we appreciate as investors. Adobe and Autodesk were also two of the top three performers within the Portfolio during 2020.”
3. PayPal Holdings, Inc. (NASDAQ: PYPL)
Number of Hedge Fund Holders: 143
PayPal Holdings, Inc. (NASDAQ: PYPL) is a California-based payments company. It is ranked third on our list of 10 best ESG stocks to buy now. The company’s shares have returned 64% to investors in the past year. Amid the attention around environmental responsibility at large corporations, especially in the context of cryptocurrencies, PayPal stock stands to benefit among peers as the firm has an unblemished track record in this regard.
On June 18, PayPal Holdings, Inc. (NASDAQ: PYPL) stock jumped close to 2% as the firm announced that it was raising merchant processing fees. The company had earlier announced that it would allow third party wallet transfer of Bitcoin as well.
At the end of the first quarter of 2021, 143 hedge funds in the database of Insider Monkey held stakes worth $14.7 billion in PayPal Holdings, Inc. (NASDAQ: PYPL), down from 147 in the preceding quarter worth $15.9 billion.
In its Q4 2020 investor letter, Polen Capital Management, an asset management firm, highlighted a few stocks and PayPal Holdings, Inc. (NASDAQ: PYPL) was one of them. Here is what the fund said:
“For the full year 2020, one of the top performers was PayPal, which we purchased in 2019, the company continues to take market share in digital payments and has seen an acceleration in user adoption and engagement, especially within their “silver tech” or older user demographic. We expect many more years of ongoing double-digit growth from their various business segments and new initiatives.”
2. Alphabet Inc. (NASDAQ: GOOG)
Number of Hedge Fund Holders: 159
Alphabet Inc. (NASDAQ: GOOG) stock has returned 74% to investors in the past twelve months. It is placed second on our list of 10 best ESG stocks to buy now. The firm is a technology company with stakes in several internet-related businesses. Alphabet was one of the first large corporations in the world to go carbon neutral and has since maintained ahead of competitors in sustainable environmental and governance practices.
On June 30, news publication Bloomberg reported that Alphabet Inc. (NASDAQ: GOOG) and software giant Microsoft had ended an agreement not to lobby against each as an antitrust drive against technology giants heats up in the United States.
Out of the hedge funds being tracked by Insider Monkey, London-based investment firm TCI Fund Management is a leading shareholder in the firm with 2.9 million shares worth more than $6.1 billion.
In its Q1 2021 investor letter, Artisan Partners, an asset management firm, highlighted a few stocks and Alphabet Inc. (NASDAQ: GOOG) was one of them. Here is what the fund said:
“Large-cap tech companies have been resilient through the pandemic—Alphabet among them. A top contributor, Alphabet’s Play Store and Google Cloud are in demand as businesses accelerate online activity which, along with strong YouTube user growth, is helping stabilize temporarily weaker search ad revenue trends. Through the lens of our disciplined bottom-up research process, we view Alphabet as one of the best businesses in the world, capable of expanding revenues at a rapid rate for years to come, with a bullet proof balance sheet and an average asking price. It’s a name we’ve owned since 2012 and for which we continue to have high hopes regarding future prospects.”
1. Microsoft Corporation (NASDAQ: MSFT)
Number of Hedge Fund Holders: 251
Microsoft Corporation (NASDAQ: MSFT) is ranked first on our list of 10 best ESG stocks to buy now. The company’s shares have returned 32% to investors in the past year. The firm makes and sells computer software and services around the world. Microsoft has also been an active member of the ESG movement. MSCI has an ESG rating of AAA for the company, ranking it in the top half of firms in the US managing ESG-related opportunities.
On June 30, telecom giant AT&T announced that it would move 5G network services to the Microsoft Corporation (NASDAQ: MSFT) cloud and sell the Network Cloud that it currently owns to the latter.
Out of the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Microsoft Corporation (NASDAQ: MSFT) with 23.9 million shares worth more than $5.6 billion.
In its Q1 2021 investor letter, Polen Capital, an investment management firm, highlighted a few stocks and Microsoft Corporation (NASDAQ: MSFT) was one of them. Here is what the fund said:
“We have written extensively about Microsoft in recent commentaries. It was our leading contributor last year and one of our largest weightings within the Portfolio. It continues to experience business momentum through several dominant, essential, and competitively advantaged businesses, like Office 365 and Azure. The markets it competes for are enormous, which gives the company the ability to compound at scale. In the past quarter alone, the company generated over $40 billion in revenue, representing a 17% growth rate. The inherent operating leverage in Microsoft’s business model continues and led to 34% earnings growth this past quarter. Despite the broad rotation we saw in the first quarter and Microsoft’s robust performance in 2020, we think its business fundamentals continue to exhibit strength, and the stock continues to reflect the fundamentals.”
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