There is a lot of spin in the world of 'green' investing and business. Companies, marketers, and public relations firms are understandably keen to portray corporate activity in the most flattering light in an increasingly eco-conscious market, whatever the underlying reality.
Tip style
Value
Risk rating
Medium
Timescale
Medium Term
Bull points
- Green transition opportunities
- Solid order book
- Undemanding valuation
- Strong cash generation
Bear points
- Fairly slow revenue growth
- Return on equity has struggled
At a capital markets day in May, the management of Ricardo (RCDO) included “corporate decarbonisation”, “zero emission propulsion”, “global policy and funding for climate change”, and “energy transition” as key trends underpinning its growth strategy. The firm’s website is also littered with references to sustainability. Strange, one might think, for a company that takes a material chunk of its revenues from services related to the burning of fossil fuels.