Goldman: listed here are 11 European firms able to beating the “magnificent 7” US on the inventory market | EUROtoday
They ought to by no means be lacking from the desk of each good investor, as in each wholesome “breakfast” you respect. At least in line with Goldman Sachs, which within the midst of the pandemic, in 2020, coined the acronym Granolas (identical to the combo of cereals and oat flakes consumed at the start of the day) to determine the 11 finest European shares by market worth in that second. It's about Gsk, Roche, Asml, Nestlé, Novartis, Novo Nordisk, L'Oreal, Lvmh, AstraZeneca, Sap and Sanofi. A “recipe” which now, in line with analysts, has the potential to beat even the large names in Silicon Valley and US Tech. Indeed, from a world perspective, explains the financial institution, Granolas have even already outperformed the perfect Californian shares within the final two years.
Granolas – says Goldman Sachs – symbolize a few quarter of the market worth of the Stoxx 600, a share just like the mixed market worth of the Energy, Basic Resources, Financial Services and Automotive sectors. «From a European perspective – they clarify – they contributed to 60% of the overall earnings of the final 12 months. They are a major consider why the European inventory market has carried out strongly regardless of the area's reasonable gross home product development.” What attracted the interest of Goldman Sachs, however, is the growth potential of Granolas in the current difficult economic scenario and above all the lower prices at which these securities are currently traded, in comparison with the similar group of shares the excellence created by Goldman for the US market, called The Magnificent Seven (includes Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta Platforms, Tesla), of which Europeans have kept pace until today. «The Granolas – observe the analysts – present advantageous characteristics in this cycle: robust profit growth, stable price trends, consistently high profit margins and solid financial positions». The price of these 11 stocks is in a high range today, with a price-to-earnings ratio of 20 times. But the point of interest, according to Goldman Sachs, is given by the fact that the prices today have a price 30% lower than those of the Magnificent Seven, which instead discount a p/e of 30 times, and their current price levels are lower at the historical average discount. «The general expectation – analysts report – is that these companies will continue their strong growth, with a forecast of +7% per year in revenues until 2025, compared to less than 2% for the rest of the market excluding Granolas» . This suggests that they will be responsible for almost all of the Stoxx 600's revenue growth in Europe. «It is likely – concludes the analysis – that this growth is driven by companies with high barriers to entry into the market, solid financial foundations and reinvestments in R&D and capital expenditure linked to growth; choices similar to the investment strategies of the Magnificent Seven”.