Billionaire investor Mario Gabelli: Look at these stocks to ride green energy, electric car crazes

Published Fri, Jul 17 202011:19 AM EDT

Kevin Stankiewicz @in/kevin-stankiewicz-b5593466 @kevin_stank

(This story is for CNBC Pro subscribers only.) Billionaire investor Mario Gabelli told CNBC on Friday that despite the immediate impact of the coronavirus, he continues to keep a big-picture focus on the societal trends that will shape the next decade. "What's going to help the planet? What's going to help people? And what's the potential for innovation that will be unleashed?" Gabelli said on "Squawk Box." "That's where we're focusing on. We're looking at things with a microscope ... short term, but we're also looking at a telescope." The chairman and CEO of GAMCO Investors singled out the adoption of renewable energy and electric vehicles and discussed stocks investors can buy to play those trends. Renewable Energy Gabelli said he believes wind and solar energy will continue to be in focus, regardless of the outcome of November's presidential election. "And then you need transmission, you need battery storage and you need cybersecurity," he said. On that front, Gabelli said NextEra Energy Partners is an attractive stock. The Juno Beach, Florida-based company has a portfolio of wind and solar projects, as well as some natural gas assets in Pennsylvania and Florida. It is a subsidiary of the larger NextEra Energy, Gabelli noted. "That's where they're putting their development projects," he said. Nextera Energy Partners shares were trading around $58 each Friday. The stock is up about 12% for the year, outperforming the broad S & P 500 index, which is down about .5% in 2020. Avangrid is another way to play the green energy space, Gabelli said. The company — affiliated with the Spanish electric utility, Iberdrola Group — is headquartered in Orange, Connecticut, and operates two main business segments. One is Avangrid Networks, an electric utility that has 3.25 million customers in New England and New York. The other is Avangrid Renewables, which primarily focuses on wind power. Gabelli noted that Iberdrola owns about 250 million shares of Avangrid, which has a total float of around 309 million. "They're going to do some financial engineering," Gabelli said. Shares of Avangrid are down about 7% year to date. It was trading higher by more than 1% to about $47 each on Friday. Electric Vehicles Gabelli noted the intense interest in electric vehicles and the potential positive environmental impact from them. He referenced Tesla, which has seen its stock rise more than 480% in the past 12 months. "Right now we have in the world 1.3 billion cars. In the United States, 260 million. In 2025, you're going to produce 100 million cars in the world. In the United States you'll produce 20 million. The electric vehicle is going to be 2 or 3 million," he said. "You'll have 5 million in hybrid electric vehicles." For that reason, Gabelli said the "easy answer" for investors wondering how to play the electric vehicle space is to look elsewhere. "You buy retailers who sell parts because the age of the cars is getting older," he said. In 1995, the average age of all light vehicles on the road was 8.4 years, according to the Bureau of Transportation Statistics . In 2019, that had risen to 11.8 years old. Gabelli rattled off some of the top players in the auto parts space: Advance Auto Parts , O'Reilly Auto Parts , Genuine Parts Company and AutoZone . All of those companies, he said, are "doing a good job at this, and at a price, we'll buy them."

Mario Gabelli

Adam Jeffery | CNBC

(This story is for CNBC Pro subscribers only.)

Billionaire investor Mario Gabelli told CNBC on Friday that despite the immediate impact of the coronavirus, he continues to keep a big-picture focus on the societal trends that will shape the next decade.

"What's going to help the planet? What's going to help people? And what's the potential for innovation that will be unleashed?" Gabelli said on "Squawk Box." "That's where we're focusing on. We're looking at things with a microscope ... short term, but we're also looking at a telescope."

The chairman and CEO of GAMCO Investors singled out the adoption of renewable energy and electric vehicles and discussed stocks investors can buy to play those trends.