(Paper straw manufacturing is just one example of benefitting from shifting public policy.)
Just as one man’s trash is another man’s treasure, a dwindling market for one product is often an emerging opportunity for another. Currently, that feels especially true in what is essentially the “green” market.
Demand for green products and climate solutions is at a premium, and only growing. It’s why one of Silicon Valley’s veteran reporters,
Kara Swisher, is one of many that believe the next wave of billionaires will make their fortunes combatting climate change.
And as public sentiment grows, so too does government pressure on businesses to adapt. One common example is the increasing number of municipalities and countries banning single-use plastics. For plastic straw manufacturers, that should trigger major alarm bells to diversify.
But those same policy changes are golden opportunities for manufacturers of alternative products, like paper straw maker
Aardvark Straws. The company saw demand skyrocket and sales increase by 5000% in 2017 as cities started to implement bans on plastic straws, and it wasn’t long before it was acquired by
HF Foods Group Inc. (
NASDAQ:HFFG).
Another current example is
Beyond Meat Inc. (
NASDAQ:BYND), which saw shares leap from $65.75 after its IPO in May to $234.90 in July before settling at its current price around $160.00. The company makes plant-based proteins that claims to taste like meat, but whether you think that claim holds up is irrelevant. What matters is that customers keep demanding them, and more and more fast food chains are partnering with the alternative-to-meat maker to bring them to market, with
KFCbeing the latest.
That’s why investors should look for opportunities when industries are forced to evolve. Take the automobile industry investing in electric vehicles, a debate that has raged for years. At the turn of the millennium, profitability in the EV space was a pipe dream that carmakers didn’t seriously consider.
Today, that dream seems imminent with each cheaper battery and new electric car model that is released, with
TeslaInc. (
NASDAQ:TSLA) leading the drive. You might not see many electric vehicles in your area, but almost every car manufacturer
sees an opportunity to cash in on the growing EV market in China (and beyond).
It might be hard to follow the emerging “green” markets for alternative products, and harder still to guess which companies will take those markets by storm, but it is an investment opportunity not worth passing up.