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Earth Day a good time to consider sustainable investment opportunities: TD Waterhouse
Wind power and solar power are sound options for green-minded investors TORONTO, April 20 /CNW/ - Sustainably-minded investors shouldn't have to choose between accumulating green in their portfolios and supporting the protection of the environment says Bob Gorman, Chief Portfolio Strategist, TD Waterhouse. "Investors interested in the renewable energy sector may have found it difficult in recent months to stick to their principles," says Gorman, who points to the recent performance of such stocks as illustrated by the Credit Suisse Global Warming Index, which fell by two-thirds from peak to trough. "However, in spite of this recent setback, there are some sectors that currently present good value." "Wind power is an area for consideration," says Gorman. "If one looks at the rise of crude prices from their cyclical lows coupled with the U.S. government's support of green energy, including the wind production tax credit through to 2012, we see an opportunity for green-minded investors." In 2008, according to the Global Wind Energy Council, global wind installations grew by 28.8%, at a cost of $47.5 billion (U.S.). That same agency, along with the U.S. Department of Energy, expects American wind power to grow substantially in the next 20 years. "While long-range forecasts for any technology should be viewed with caution, wind's increasing cost-competitiveness augurs well," Gorman adds. "Green investors should also consider solar power - especially the photovoltaic variety, which converts sunlight directly into electricity - as it will likely become increasingly attractive to investors." The cost of high-grade polysilicon used in photovoltaic cells has been declining sharply in price, as expansion of production capacity has cut the cost per pound by more than 50% over the past year. This reduction in costs has the effect of lowering the cost per kilowatt-hour of the energy produced. Gorman notes that the renewable energy sector has been oversold in recent months, due to a perfect storm: the collapse of crude oil prices made alternative energy less compelling; tightening and costlier credit made major capital expenditures less viable; and stocks with high price/earnings multiples were harder hit in the market downturn. However, this sector may now represent a good buying opportunity. "Many Canadians use Earth Day as an opportunity to take stock of their carbon footprint and make resolutions to help the environment by using public transportation and recycling," says Gorman. "Investors who value sustainability can use this opportunity as well to consider their green investment strategy." As always, investors should do their own research or speak with their advisor to ensure that any investments they undertake meet their objectives and are consistent with their risk profile. About TD Bank Financial Group The Toronto-Dominion Bank and its subsidiaries are collectively known as TD Bank Financial Group. TD Bank Financial Group is the sixth largest bank in North America by branches and serves approximately 17 million customers in four key businesses operating in a number of locations in key financial centres around the globe: Canadian Personal and Commercial Banking, including TD Canada Trust and TD Insurance; Wealth Management, including TD Waterhouse and an investment in TD Ameritrade; U.S. Personal and Commercial Banking through TD Banknorth and TD Bank, America's Most Convenient Bank; and Wholesale Banking, including TD Securities. TD Bank Financial Group also ranks among the world's leading online financial services firms, with more than 5.5 million online customers. TD Bank Financial Group had CDN$585 billion in assets on January 31, 2009. The Toronto-Dominion Bank trades under the symbol "TD" on the Toronto and New York Stock Exchanges.
For further information: For an interview with Bob Gorman to discuss his stock picks for the wind and solar power industries, please contact: Barbara Timmins, (416) 307-6498
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