European financial powerhouse ING Groep (NYSE:ING) plans to phase out financing of upstream oil and gas activities by 2040. Moreover, the company aims to triple new financing for renewable energy by 2025.
This significant change in ING’s energy approach follows the United Nations Climate Conference (COP28), where over 190 members agreed to transition away from fossil fuels. Additionally, over 20 countries launched a declaration to triple nuclear energy capacity by 2050.
Now, ING is aiming to lower its loans to upstream oil and gas activities by 35% by 2030. Concurrently, its renewable power financing is expected to shoot up from €2.5 billion in 2022 to €7.5 billion by 2025. The International Energy Agency (IEA) is seeking to triple renewable energy capacity by 2030. ING’s goals are five years ahead of this timeline.
At present, nearly 80% of global energy comes from fossil fuels. Still, a growing number of companies are moving towards sustainability as the world gradually transitions towards green energy and net-zero greenhouse gas emissions by 2050.
This pivot could boost the fortunes of renewable energy and nuclear energy names. Shares of companies such as Cameco Corp. (NYSE:CCJ) and Uranium Energy (NYSE:UEC) have already rallied by nearly 247% and 257%, respectively, over the past three years. Meanwhile, Blackrock (NYSE:BLK), the largest asset manager globally, has come under fire for its ESG strategies in Tennessee.
What is the Stock Price Prediction for ING?
While analyst coverage on ING remains scant, the company’s shares have rallied by nearly 31.6% over the past year. Despite this run-up, the stock is still trading at an attractive price-to-earnings multiple of 7.4 and a price-to-sales ratio of 1.34.
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