Safe growth stocks are those that encourage and support a growing industry. So even though much is still uncertain in the UK, we are fortunate as investors to be living in a time when we can predict, with some reliability, the future of renewable energy.

COP26 has bolstered what some are calling a revolution, emphasising the need for cutting down on traditional power sources in favour of electrification and wind power. Many billions have been invested into developing renewables, and because many countries are keen to lead it, investment from governments is significant. BP and other oil companies have shown their intention to invest serious money, and I believe 2022 will see much more money from them.

How will I take advantage of this energy revolution?

The new technology needs resources, in great quantities, in order to grow. In short, it needs lithium, copper, and rare earths. China has in many ways beaten the west to the line in securing much of the supply around the world. So finding a good investment opportunity isn’t as easy as you think.

In regards to rare earth, there are alternatives not yet scooped up by the east. One particularly good play is Rainbow Rare Earths, which has the Phalaborwa Project in South Africa and the high-grade Gakara Project in Burundi, East Africa. Rainbow’s strategy is to become a globally significant producer of rare earth metals. It also has advanced processing technology enabling extraction with relative ease. It also has the USA as significant investors. At just 16p, the shares are cheap as chips.

For lithium, my choice is Zinnwald Lithium, which now has a 100% ownership of a 30-year lithium project in Germany, close to the European car manufacturers who will be using its high-grade product to in their electric batteries. At a current share price of just 16p, this also has a big scope for growth.

My copper choice is Rambler Metals and Mining, which has a 100%-owned copper-gold mine in Canada. It is fully funded and producing at a significant capacity. They have some debt to pay off but the production far outweighs the overhang. The gold is a bonus. At the current price of just 32p this is also far below what it should be.

These are growth companies that are in my opinion undervalued. However, they are small caps and have all the usual risks which come with that. But of course, what the last two years have show us is that we cannot predict what’s around the corner: 2022 might be no better than 2021 delaying the energy revolution further. But I believe it is inevitable, if not now then soon.

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Alex Crisp owns shares in Rambler Metals and Mining. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Jim Mellon’s (Master Investor) Agronomics is a seed funding investment company, invested in ‘lab-grown’ (cell based) animal and agricultural products: meat, fish, milk, eggs, leather, pet food, and more. Agronomics currently has 16 companies in its portfolio, including BlueNalu, which aims to be the global leader in cell-based fish and has products on the market in Asia. It has been tipped to go public in 2022. Another is Mosa Meat, a Dutch company that produces cell-based beef and has just included Leonardo De Caprio (who now sits on the board) as one of its top investors.

Other prominent investors in this industry include Jeff Bezos, Bill Gates, Richard Branson, and Alphabet, as well as actor Ashton Kutcher.

The prediction

Winston Churchill predicted “we shall escape the absurdity of growing a whole chicken in order to eat a breast or a wing, by growing these parts separately under a suitable medium”.

These groups of companies are working on this becoming true. The products are not synthesised or plant based, they are the real thing: real fish, real chicken, real beef, but rather than reared in a field, they are grown in a lab. No animals are hurt, no seas are fished. The benefits are clear. Though there are still many who would baulk at the idea of this product being dished up to them, it cannot be ignored that if we need technology to help us feed the planet then this is a clear contender.

Barclays estimates the global alternative meats market will be worth £120bn by 2029. Agronomics has invested nearly £200m into a market that currently has less than £2bn invested in total, securing a significant market share. It is very probable that Agronomics will be a multi-billion dollar business in the not too distant future, in my opinion. I believe that from its lowly 22p per share today, it’s very possible that £10 per share can be reached in several years from now.

Barriers

What currently stands in the way of whole-scale adoption are:

1. convincing the public that’s a viable alternative;
2. scaling up production to sufficient capacity to lower overall costs;
3. regulatory approval.

There will inevitably be kickback from large-scale farmers who are, of course, very protective over their industry. But times are changing, demand for animal proteins is increasing, so I think it’s only a matter of time before we see these products on our shelves. There have already been some very interesting collaborations between producers and top international suppliers. This is perhaps a bottom-drawer share, but one I will want to keep taking out and having a look at.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Alex owns shares in Agronomics. The Motley Fool UK has recommended Alphabet (A shares). Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

The latest half-year results were ahead of expectations, which is surprising when you consider the UK March lockdown. Profits are not yet back up to pre-pandemic levels but National Express has historically shown resilience, and (largely due to £100m worth of cost savings) it has managed to show a half-year operating profit of £54m. I believe it’s only a matter of time before it demonstrates how recoverable it is, and I believe that end-of-year results will support this prediction. I consider this a potential recovery stock.

The case for

Understanding that the world into which we’re emerging will not be the same one we left behind a couple of years ago, a world into which our increasingly ageing population are travelling more cautiously, and perhaps do not yet feel ready to venture abroad, gives me confidence in National Express shares. Also air flight is environmentally unpopular and will probably never return to what it once was. Maybe this is a good thing (unless you hold shares in the likes of IAG).

The phrase ”staycation“ was pinned to everyone’s lips last summer, and is likely to stay there for a few summers to come, so coach travel may become the preferred option for many.

Merger with Stagecoach

It’s an ambitious company too. Its restlessness in regards expansion is clear, most recently through the proposed merger with Stagecoach Group announced on 21st September. Both companies’ share prices shot up at the time it was announced, but have since drifted. Now a new deadline has been set for 14th December in order to make clear and final their intention to merge. Such a merger has clear advantages i.e. cutting down on duplicate routes, office space and staff, and adding buying clout for future expansion plans.

Case against

There are potential negatives of course. Firstly the upward travel of the price of fuel, which some expect to reach above $100. There is the potential for another lockdown, which would clearly have an impact on all travel companies, including National Express. Then, even without the lockdown, there is still the chance that people are just more reluctant now to travel by shared means, sitting next to strangers.

Aside from my fond memories of student journeys up the M1, getting home for Christmas for under a tenner, I like this share. It’s a safe buy for my portfolio in my opinion, and if the merger does happen it could trigger a good recovery.

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Alex Crisp has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.