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Growing European stocks
12
Feb
Growing European stocks

 

This overview is dedicated to the large European companies that have shown the greatest stock price growth over the year from January 2015 to February 2016. We have included only companies with capitalization over €10B (there are some hundreds of such companies in the EU.) The capitalization and turnover have been converted into euro, while the quotes are given in the initial currency.

The situation has changed drastically since our last overview of the European market. The crisis of 2016 has significantly weakened many enterprises: last time the quotes growth exceeded 50% in all cases, and now there are only two companies that have overcome this threshold. Moreover, there is not a single company with capitalization of over €19B: they were beaten by the crisis most severely, and have grown max. 30%.

 

1. Pandora

  • Ticker: PNDORA
  • Stock Exchange: Copenhagen Stock Exchange
  • Country: Denmark
  • Currency: Danish krone
  • Capitalization: €14B
  • Yearly turnover (2013): €1.5B
  • P/E: 32
  • Annual stock growth: 106%
  • Annual dividend income: 1.0%

A typical ad by Pandora.

Jewelry company founded in 1982. It designs, produces and sells jewelry made of gold, silver, leather, textile, and other materials. Initially it operated only in Denmark; nowadays the production is moved to Thailand, and the jewelry is sold in more than 90 countries through distributors and 1400 branded shops.

pndora копия.jpg

Pandora's stocks are traded in the market since 2010. At first, in 2011, they fell almost two times. Since then they started a stable growing trend, thus surpassing the IPO level by three times.

Although the stock prices have been growing stabily for four years, its P/E is quite large now, so the continuation of the trend is questionable: investment in Pandora is rather risky now.

 

2. Vestas Wind Systems

  • Ticker: VWS
  • Stock Exchange: Copenhagen Stock Exchange
  • Country: Denmark
  • Currency: Danish krone
  • Capitalization: €12B
  • Yearly turnover (2013): €6.7B
  • P/E: 22
  • Annual stock growth: 55%
  • Annual dividend income: 0.9%

Most of us have seen wind power stations from afar, but their size is still astonishing. In the picture you can see the wind generator in transportation without blades. Each blade, in its turn, is several times larger than the generator.

One of the largest wind generator producers in the world. The company was founded in 1898, but it built the first wind plant in 1979. Before that, it was creating a wide range of appliances like mixers, containers, agricultural machines, etc. By today, Vestas has allocated some dozens of thousands of wind plants with the total output of more than 30 gigawatt. 

vws копия.jpg

During the crisis of 2008 Vesta's stocks slumped by two thirds, and continued weakening afterwards. In the result, the stock prices decreased by 28 times during the period between 2008 and 2012. Since 2013, the company's state has become more stable, and by now the price almost returned to the level of 2007.

Judging by the P/E, the company's stock price is adequate, and it is hard to say for sure, if the growth will continue. Just like Pandora, Vestas may become a risky investment.

 

3. Adidas

  • Ticker: ADS
  • Stock Exchange: Deutsche Borse
  • Country: Germany
  • Currency: Euro
  • Capitalization: €19B
  • Yearly turnover (2013): €15B
  • P/E: 28
  • Annual stock growth: 46%
  • Annual dividend income: 1.6%

Adidas is not only developing sports garments, it's developing philosophy. In their presentations, they say, 'adidas is a truly global sports brand. Therefore, everything we do is rooted in sports. Everything that happens in sports happens in moments. Every moment is a chance for the athlete to start over and take today.'

One of the largest world producers of sportswear and inventory. The company was created in 1920 as a family sewing enterprise called Dassler. It became famous in 1936 thanks to Jesse Owens, the Afroamerican runner who won four gold medals in the Olympics wearing Dassler shoes. After the war, the company was renamed into Adidas. Today Adidas has 8 factories in Germany and 25 divisions in other countries. In 2006 Adidas acquired its famous rival, Reebok.

ads копия.jpg

Adidas' quotes rose rather quickly after the fall in 2008, beating the before-crisis record by the end of 2013. In 2014 they dropped again, but returned to the upward trend and beat another record.

Just like in the previous cases, investing in Adidas may pose a threat to the investor's capital. The stable growth of stock prices ended up in 2014, and despite the current adequate assessment, the price may fluctuate in the future.

 

4. Infineon Technologies

  • Ticker: IFXA
  • Stock Exchange: Deutsche Borse
  • Country: Germany
  • Currency: Euro
  • Capitalization: €10B
  • Yearly turnover (2013): €3.8B
  • P/E: 29
  • Annual stock growth: 42%
  • Annual dividend income: 1.3%

The futuristic office of Infineon Technologies in Singapore.

A large producer of microchips. The company has factories in Germany, Austria, Italy and Hungary. It used to be a division of Siemens, becoming independent in 1999.

ifxa копия.jpg

The stable growth of stock prices since 2009 is just a recovery from the dramatic fall in 2007-2008. The records of 2007 were beaten only at the end of 2015.

Despite the general positive trend, Infineon quotes are quite volatile, especially lately, making the company's stocks risky to trade.

 

5. Thales

  • Ticker: HO
  • Stock Exchange: Euronext
  • Country: France
  • Currency: Euro
  • Capitalization: €14B
  • Yearly turnover (2013): €13B
  • P/E: 25
  • Annual stock growth: 37%
  • Annual dividend income: 1.7%

Thales’ ad: 'The world is complex. Your decisions should not be.'

Instrumentation company that produces electrical appliances for transportation, aerospace sphere and stock exchange markets. The company was named after Thales of Miletus, the Greek philosopher. It has branches in a dozens of branches on most continents, and more than a half of turnover is provisioned by foreign branches outside of France.

ho копия.jpg

Unlike other assets, Thales' stocks cheapened after the crisis of 2008 not at once, but gradually. They reached the bottom only in 2011, starting to grow in 2013.

The moderate P/E tells us that these stocks have some space to grow, and despite some local falls, it may be a good moment to invest in them.

 

6. Scania

  • Ticker: SCV-B
  • Stock Exchange: NASDAQ OMX Stockholm
  • Country: Sweden
  • Currency: Swedish krona
  • Capitalization: €17B
  • Yearly turnover (2013): €11B
  • P/E: 25
  • Annual stock growth: 36%
  • Annual dividend income: -

Scania's design is very recognizable.

A world-famous producer of trucks, buses and motors. It is one of the oldest companies in the field founded in 1891. Today it is an international company that has factories in Sweden, France, the Netherlands, Argentina, Brazil, Poland and Russia. It is engaged in alternative energy research, and has several lines of eco-friendly machines production. Their buses that use ethanol as fuel have already become a special feature of Stockholm, and many other cities are planning to purchase them. It is worth mentioning that, despite being a public company, more than 80% of its stocks are owned by Volkswagen AG and Man.

 

7. Veolia Environnement

  • Ticker: VIE
  • Stock Exchange: Euronext
  • Country: France
  • Currency: Euro
  • Capitalization: €12B
  • Yearly turnover (2013): €24B
  • P/E: 31
  • Annual stock growth: 33%
  • Annual dividend income: 3.2%

Green purification works by Veolia Environnement in Hong Kong.

The company works in the areas of water supply, public services, energy production and transportation, including airport, railway and public transport services. It its field, it is one of the oldest companies: it was established in 1853 by Louis Napoléon III to support water supply in the country. Today Veolia Environnement owns electric power plants, incinerators, water treatment works, etc., in dozens of countries.

vie копия.jpg

Just like Vestas Wind Systems, Veolia Environnement was severely injured in 2008. During the period between 2008 and 2012 the company's stock prices decreased by 7 times. Today they got back to the level of 2009-2010, but it's still a long way back to the levels of 2007-2008.

It seems that investing in Veolia now is not very risky. The prices grew well in 2015, and the chances are, they have achieved the maximum, which is, however, rather objective (according to the P/E). The company pays rather high dividends, so it may become a good option for middle- or even long-term investment.

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