ESG: Graham Clapp Says ESG-Focus is Creating a New Bubble

February 27, 2020 | ESG and Sustainability, News
https://dailyalts.com/wp-content/uploads/2020/02/52e4dc4a4854ae14ea898579ce203e7c1d22dfe05b53794a732973d6_640.jpg

RWC Partners fund manager Graham Clapp warned that sustainable investing trends are poised to form a possible bubble in the markets. He compared it to the tech boom of the 1990s.

“You can liken it to the tech bubble where people wanted to have exposure to the new economy stocks, so a lot of money poured into certain kind of business models and valuations were pumped up and incredibly stretched. When such large influxes occur – as we’re currently seeing with ESG – then supply and demand mean the price is going to change,’ Clapp said.

He spoke on the valuation stretch of the late 1990s. During the Dot-com boom, price-to-earnings stretched to 80 times before retreating back to 30 times earnings.

“We’re not quite there yet but it’s getting to the point where anything related to hydrogen or other green technologies, for example, are all up 100% in six months, despite the fundamentals not having changed,” Clapp wrote.

Graham Clapp on ESG

Clapp looked at the ongoing boom of buying in the wind turbine industry despite glaring issues in valuations and earnings potential.

“We’ve had multiple profit warnings from the largest manufacturer of offshore wind turbines globally, yet this is not being reflected in the share price. Whilst we may see a short-term drop immediately following a warning, this very quickly rallies back and then moves higher, despite the stock looking quite expensive.”

He continued:

“It’s getting to the point where anything related to hydrogen or other green technologies, for example, are all up 100% in six months, despite the fundamentals not having changed,” he said

Free Industry News

Subscribe to our free newsletter for updates and news about alternatives investments.

  • This field is for validation purposes and should be left unchanged.


Shape

Latest Alternative Investment News

https://dailyalts.com/wp-content/uploads/2022/08/10_sound_box_2.0_payment_terminal_storage_optimization-2-800x500-1.jpg
FinTech: India’s PayTM Gets Heat From Proxy Advisory Firm
August 12, 2022     FinTech, News

Proxy advisory firm Institutional Investor Advisory Services India Ltd. (IiAS) has issued a note ahead of PayTM’s (NSE: PAYTM) annual shareholders’ meeting on August 19 calling for the replacement of…

https://dailyalts.com/wp-content/uploads/2022/08/planet-g69e0d7747_640.jpg
Venture Capital: Lockheed’s Venture Arm To Boost Investment In Space Startups
August 12, 2022     News, Venture Capital

Lockheed Martin (NYSE: LMT) and its venture finance arm Lockheed Martin Ventures plans to boost the latter’s investment outlay from $200 million to $400 million.

https://dailyalts.com/wp-content/uploads/2022/08/picpay-lover.jpg
Digital Assets: Brazilian Fintech PicPay Launches Crypto Exchange With Paxos

PicPay, the well-known Brazilian payment app, has got its shoe in the crypto door in partnership with Paxos, a leading regulated blockchain infrastructure company. Picpay is opening crypto trading services…

https://dailyalts.com/wp-content/uploads/2022/08/one-braham-logo-2.jpg
FinTech: Telecom Behemoth BT Adds Barclaycard Payments To Partnership Network For Micro-Businesses
August 12, 2022     FinTech, News

BT (LON: BT.A), the telecom major, announced that Barclaycard Payments had joined its partnership network seeking to help the growth of UK microbusinesses. BT customers with 0-5 employees would get…