Yesterday saw crude oil again surge to fresh multi-year highs but the oil stocks almost unfathomably cannot breach their June high, let alone get close to where they were when oil last set its sights on $US90/barrel. We understand that the trend towards ethical investing (ESG) precludes some funds from buying the likes of STO but the valuation gaps becoming very hard to ignore.
Fossil fuel stocks are being ignored for renewable companies but the former are churning out huge profits whereas the new flavour of the month are being priced for absolute perfection, we feel plenty of money will be lost with this lemming style direction to investment, some green business will undoubtedly become huge success stories but history tells us many more are likely to fail.
MM remains bullish STO initially looking for 10% upside
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