Are Green Stocks Worth It?

By Armando Duke

Houston, TX - Most investors look for a return when they invest, but you can also choose to invest responsibly and do something good for the planet by looking into Green Stocks, a group of companies that may not show immediate returns.

Earlier this week, I read a story in the San Antonio Business Journal covering greens and I had to wonder when I saw General Electric Co. (NYSE: GE) mentioned under that category. Why not include British Petroleum (NYSE: BP), after all, they're cramming TV commercials down our throats about how much they're looking into alternative fuels and lets broaden that and include Ford Motor Co. (NYSE: F) and General Motors Co. (NYSE: GM) because they're trying to make hybrid vehicles.

You can stretch your imagination and categorize a lot of stocks as "green", but lets face it, the category is fairly new and most pure greens are micro cap companies struggling to be heard, like Itronics, Inc. (OTCBB: ITRO), which last week said it was named one of the world's first International Green Heroes by The Green Organization, an independent international environmental group, in a ceremony at Kensington Roof Gardens, London.

Reno-based Itronics recycles photochemicals, removing the heavy metals and manufacturing a 5-ounce silver bar from it with the bulk of the liquids being used to make environmentally beneficial liquid fertilizer products sold under the GOLD'n GRO brand. Now that's GREEN! Yet Itronics' growth is slow and has yet to turn a profit, but it is making progress and earlier this year brought in $3 million in financing to double the size of its plant in order to keep up with demand.

Solar companies and ethanol makers are also getting green investors' attention, spurred on by California's commitment to move to solar power and the high cost of fuels, many of these micro to small cap companies are being eyed as greens worth exploring. In fact, even the big board is getting in on the green game.

Shares of VeraSun Energy Corp. (NYSE: VSE) surged on their NYSE debut last week following a successful initial public offering. The South Dakota-based maker of ethanol fuel opened for trade nearly 22 percent above the offering price.

SunTech Power (NYSE: STP), the Chinese maker of photovoltaic cells whose IPO debuted last year at $15, nearly tripled in its first month and is still trading at a 40%+ premium, may yet prove to be worth it at these levels and is right in there with VeraSun and Itronics when you put it in the Green group.

Greens mean patience when it comes to investing. These stocks are fairly new and that means it will take time to see which one's pan out. Some take advantage of economic trends, like soaring energy, while others deal more with more basic issues such as conservation and pollution. They run the gamut from big board backing to struggling micro caps and everything in between. There are green funds and indexes springing up, newsletters and even green investment clubs to choose from. But you still have to be careful when you invest in green stocks as there are a lot shady shell deals springing up too.