In this article, we discuss 5 cheap ESG stocks to buy now. If you want to see more cheap ESG stocks, the risk/reward and methodology of this list, go directly to 10 Cheap ESG Stocks to Buy Now.
5. AbbVie Inc. (NYSE:ABBV)
Forward P/E as of 11/8: 12.72
Number of Hedge Fund Holders: 71
AbbVie Inc. (NYSE:ABBV) has an environmental goal of reducing its carbon emissions by 25% from its 2015 baseline and to reduce its waste created by its businesses. The company has also been very inclusive with 51% of its management positions held by women and AbbVie Inc. (NYSE:ABBV) has donated $1.2 million to disaster relief organizations in 2021 as well. AbbVie Inc. (NYSE:ABBV)’s CEO also added in a 2021 ESG Action Report,
We have a proven track record of developing new innovative medicines that have made a remarkable impact for patients and will continue to change lives for years to come. Since our inception, we have achieved more than 21 major product or indication approvals. Through our pipeline of promising therapies, we anticipate the potential approval of more than a dozen new products or major indications over the next two years. These important milestones have the potential to help millions of additional patients. In addition to our medicines, we continued to deliver on our commitment to society. Together with our nonprofit partners, we advanced health and educational opportunities for underserved communities through our philanthropic commitments and continued to address the impact of COVID-19 through humanitarian support and employee volunteering efforts.
As of 11/9, AbbVie Inc. (NYSE:ABBV) shares have rallied 9% as the market has become more confident on the company’s earnings potential for the future.
4. Merck & Co., Inc. (NYSE:MRK)
Forward P/E as of 11/8: 13.51
Number of Hedge Fund Holders: 79
According to the company in August, Merck & Co., Inc. (NYSE:MRK) is on track to achieve carbon neutrality across its operations by 2025 and to source 100% of its purchased electricity from renewables in the same year. In 2021, Merck & Co., Inc. (NYSE:MRK) also increased representation of women globally to 36% up from 31% in 2020. 2022 has been a good year for Merck & Co., Inc. (NYSE:MRK) as shares of the stock have rallied over 32% year to date as 11/9.
3. Bank of America Corporation (NYSE:BAC)
Forward P/E as of 11/8: 9.99
Number of Hedge Fund Holders: 99
Bank of America Corporation (NYSE:BAC) has long had a commitment to environmental sustainability as the company has goal to achieve net zero greenhouse gas emissions in its financing activities, operations and supply chain before 2050. Bank of America Corporation (NYSE:BAC)’s multi-year financing commitment provides financial capital and intellectual capital to develop solutions to climate change and other environmental challenges. Shares of Bank of America Corporation (NYSE:BAC) trade for around 10 times earnings as of 11/8.
2. JPMorgan Chase & Co. (NYSE:JPM)
Forward P/E as of 11/8: 10.27
Number of Hedge Fund Holders: 104
ESG matters have been important to JPMorgan Chase & Co. (NYSE:JPM) as the leading bank has a sustainable development target to finance and facilitate over $2.5 trillion over 10 years to help address climate change and promote sustainable development. JPMorgan Chase & Co. (NYSE:JPM) is also dedicated to helping address the racial wealth gap and to help develop a more inclusive economy. With a forward P/E of 10.27, JPMorgan Chase & Co. (NYSE:JPM) is pretty cheap in the long term if it can maintain its market share.
1. Meta Platforms, Inc. (NASDAQ:META)
Forward P/E as of 11/8: 11.79
Number of Hedge Fund Holders: 184
Meta Platforms, Inc. (NASDAQ:META) ranks among the leading ESG companies given that its mission is to give people the power to build community and to bring the world closer together. Meta Platforms, Inc. (NASDAQ:META) has also worked to build a diverse and inclusive workplace and is striving for net zero value chain emissions in 2030.
ClearBridge Investments commented on Meta Platforms, Inc. (NASDAQ:META) in a Q3 2022 investor letter,
“Meta Platforms, Inc. (NASDAQ:META), one of two overweights among the mega cap stocks, underperformed in the third quarter (-15.9%) and is the Strategy’s largest detractor year to date. Meta has also trailed mega cap advertising peer Alphabet, which we don’t own, as revenue growth has slowed due to tough comparables to a strong e-commerce environment in early 2021, negative impacts from Apple’s privacy changes and rising expenses.
While we have trimmed our position close to 20%, we remain invested as we do not think the stocks’ valuation at about 13x consensus 2023 earnings appropriately reflects its long-term earnings and free cash flow generation potential. Despite current revenue headwinds, we believe Meta is well-positioned to navigate industrywide changes to advertising targeting and its transition to the Reels short-form video format will monetize in the coming years, helping to re-accelerate revenue growth.
We also welcome Meta’s implementation of cost-cutting measures, which should help uncover the company’s high underlying profitability. Lastly, we see Meta’s investments in augmented reality as a call option for long-duration investors.”
Of the 895 funds in our database at the end of Q2 2022, 184 owned shares of Meta Platforms, Inc. (NASDAQ:META), ranking the company #1 on our list of 10 Cheap ESG Stocks to Buy Now.
You can also take a look at 20 Most Admired Companies in the World in 2022 and 15 Biggest Dow Companies By Market Cap.
