World Stock Watch

Unloved Europe: A Treasure Trove of Investment Opportunities

As investors flock to the US market, fueled by Trump’s election win, a savvy fund manager is urging them to look elsewhere. Sean Peche, of Ranmore Fund Management, believes that Europe, particularly its mid-cap companies, offer attractive investment opportunities.

France: A Political Storm in a Teacup

Despite France’s recent political turmoil, Peche remains unfazed. He points to French bank BNP Paribas, which has consistently grown its book value, and Dutch investment bank ABN Amro, boasting a 10.2% dividend yield. These companies, he argues, are undervalued and ripe for investment.

The UK: A Hidden Gem

Across the Channel, Peche identifies Associated British Foods, owner of retail giant Primark, as another overlooked gem. With a strong management team and a diversified business, Primark is an attractive investment opportunity, offering a nice dividend and share buybacks.

Mid-Cap Magic

Peche is bullish on mid-cap firms, including US toy giant Mattel. With its diversified portfolio of household brands, such as Barbie and Hot Wheels, Mattel has turned its business around, making debt manageable and launching a $1 billion buyback. The release of a new animated Barbie Netflix series and a documentary series charting Mattel’s rise give the company growth potential.

Growth Potential

Mattel’s success is evident in the sharp rise in Barbie toy purchases following the release of the “Barbie” movie, which grossed over $1.4 billion worldwide. The company has also produced toys for hit films like “Moana” and “Wicked.” Although toy sales slid during the third quarter, Peche believes Mattel’s growth potential remains strong.

Investment Opportunities Abound

In conclusion, Peche’s message is clear: investors should look beyond the US market and explore the unloved region of Europe, where attractively priced companies await discovery. By doing so, they may uncover hidden gems like BNP Paribas, ABN Amro, Associated British Foods, and Mattel, which offer promising investment opportunities.