For sustainably minded investors, sifting through the stocks owned by sustainable funds is one way to unearth opportunity. Global sustainable funds emphasize companies committed to sustainability and responsible practices, usually measured by environmental, social, and governance criteria, while balancing their portfolios with traditional financial metrics. These funds often own stocks that traditional funds don’t hold, or hold to a much lesser degree. In this article, we found eight stocks that have a unique presence in comparison with traditional funds.
A Look at Our Methodology
To obtain top stocks widely owned by ESG global sustainable funds, we ran two searches on the open-end and exchange-traded funds coverage. We looked for large-cap global funds and selected the oldest share classes. We looked at the funds that are considered sustainable investment and compared them with the traditional funds. We pulled the top 500 holdings from the sustainable funds, and likewise for the traditional funds, and analyzed the average weights of each security.
With this approach, we were able to locate the stocks that were unique to the sustainable funds. We looked for unique stocks that were not US domiciled. This created a list of unique stocks in the ESG global large-stock space.
Stocks That Are Uniquely Held by Global Sustainable Funds
Schneider Electric SE SU
Morningstar Rating: 3 Stars
Schneider Electric is in a comfortable financial position. Its net debt to EBITDA ratio increased to 2.1 times at H1 2025, due to the EUR 5.5 billion paid to acquire the remaining 35% of minorities in its Indian joint venture. We expect its net debt/EBITDA ratio to be 1.4 times at the end of 2025, given its free cash flow generation is weighted toward the second half of the year, and forecast that Schneider will be in a net cash position by 2029.
Its robust outlook and 100% free cash flow conversion rate provide plenty of room for additional shareholder distributions or acquisitions.
Matthew Donen
Infineon Technologies AG IFX
Morningstar Rating: 4 Stars
We assign Infineon a narrow economic moat, as we think it is more likely than not that the company will be able to earn excess returns on capital over the next decade. We think the firm’s automotive chip business benefits from both intangible assets around proprietary chip designs, as well as high switching costs once the firm’s products are designed into automotive programs. We also believe that the company’s power chip business (almost 50% of revenue between industrial and power management products and excluding the portion of power semis also in automotive) benefits from intangible assets around design expertise for high-voltage products.
Brian Colello
TE Connectivity PLC Registered Shares TEL
Morningstar Rating: 2 Stars
Our fair value estimate of $200 per share implies a forward fiscal 2026 adjusted price/earnings multiple of 19 times and an enterprise value/sales multiple of 3 times.
We anticipate 9% compound annual sales growth through fiscal 2030. We expect the transportation solutions segment to grow 4% over our explicit forecast, which includes our expectation for softer demand in the medium term. We expect the automotive and commercial transportation markets to experience content growth over underlying production within management’s 4%-6% target range.
William Kerwin
BYD Co Ltd Class H 01211
Morningstar Rating: 3 Stars
We believe BYD is in good financial health by having a reasonable level of debt on its balance sheet. The company had about CNY 103 billion in cash and equivalents on its balance sheet, and carried a conservative debt/capital ratio of 14% at the end of 2024 and is in a net cash position. Therefore, the firm should have no problem fulfilling its debt obligations and refinancing debts as they are due. Even though the automobile manufacturing business is capital-intensive, we think the company’s strong cash position and improving operating cash flows allow it to expand manufacturing facilities during economic downturns. Its healthy financial position presently should enable it to raise more debt comfortably if needed.
Vincent Sun
Vestas Wind Systems AS VWS
Morningstar Rating: 3 Stars
Aiming to establish itself as a leading player in the offshore wind market, which is expected to grow by 25%-30% annually through 2030, Vestas acquired Mitsubishi Heavy Industries’ stake in their joint venture dedicated to the space in 2020. Offshore will absorb the bulk of the EUR 1.2 billion in capital expenditures planned for 2025, primarily to support the manufacturing ramp-up of its flagship V236-15MW turbine. While management expects offshore to be margin-dilutive in the near term, it anticipates the segment’s profitability will converge with onshore levels over time.
Tancrede Fulop
Novonesis (Novozymes) B Class B NSIS B
Morningstar Rating: 3 Stars
We believe Novonesis earns a wide moat based on intangible assets, switching costs, and cost advantage. The merger between Novozymes and Chr. Hansen has brought together two leaders in the field of biological solutions with more than a century of experience in fermentation technology and bioengineering, which forms the basis of their proprietary technology. This can be traced to their Danish heritage, as Denmark is widely considered the center for fermentation technology. In fact, the second-largest player in the enzymes and cultures market, wide-moat International Flavors and Fragrance, has also achieved this position through the acquisition of Danish company Danisco from DuPont.
Diana Radu
Recruit Holdings Co Ltd 6098
Morningstar: 3 Stars
Recruit’s balance sheet is sound. Recruit maintains a strong net cash position with negligible outstanding debt. Recruit is also highly cash-generative, and we forecast positive free cash flows for our explicitly forecast period. We view Recruit’s net cash position as appropriate, given the highly cyclical nature of its business.
Ron Van Keulen
Contemporary Amperex Technology Co Ltd Class A 300750
Morningstar Rating: 2 Stars
Lithium-ion battery production is capital-intensive, and producers must incur high capital expenditure to expand their operations organically or through acquisitions. That said, the company’s balance sheet looks sound, and the debt/capital ratio is not excessive at 35% as of end-2024. With CNY 45 billion raised through private placement in June 2022 and improved profitability amid industry tailwinds, we expect CATL’s gearing ratio to remain healthy with a net cash position and conservative debt/capital ratio of 35% by end-2025.
Vincent Sun
