Brexit negotiations will soon begin and I believe companies with large economic moats and defensive characteristics will perform well. An economic moat will enable improved financial performance versus sector peers during what may prove to be a challenging period for consumers and the wider economy. Defensive characteristics should help to further protect companies from the…
According to a range of headlines this week, car insurance premiums are set to soar. Normally, this would be great news for car insurers such as Direct Line (LON:DLG), but its shares slumped 7% on the news. The reason for this is a profit warning, brought about by a change to the discount rate which…
Lloyds (LON:LLOY) has a valuation which I think is exceptionally cheap. I feel this will be important during 2017, since there are clear risks facing investors. For example, Brexit talks are about to commence and according to the President of the EU Commission, Jean-Claude Juncker, the two-year period will see the EU adopt a tough…
Kraft Heinz’s bid for Unilever (LON:ULVR) will not be the last takeover approach for the Anglo-Dutch business, in my opinion. The strength of the US dollar makes it an obvious move not only for Kraft Heinz, but for other US-based consumer goods companies who wish to tap into the stunning growth potential of emerging markets.…
Predicting the future is fraught with difficulty. Even during the most genteel of trading conditions, risks can come along which even the most pessimistic, doom-mongering of investors didn’t see coming. Given the uncertainties facing investors at the moment, I think it’s even more challenging than ever to guess which way the market is going to…
The tobacco sector looks ripe for consolidation. Already in recent months, sector heavyweight British American Tobacco has sought to merge with Reynolds. There are also continued rumours about a potential re-merger between Altria and Philip Morris. This scope for M&A activity is coming along for two main reasons, in my opinion. First, cigarette volumes are…
Low interest rates have incentivised borrowing in recent years. There has been little reason for companies to reduce their debt levels. Therefore, businesses in a range of sectors have leveraged up their balance sheets in order to improve shareholder returns. This has helped to boost profits and generated higher returns for investors. However, a more…
In my view, dividend investing is about more than simply buying a handful of high-yielding shares. I focus less on yield than most dividend investors and more on dividend growth. A long-term investment horizon dictates that a stock which can grow dividends quickly may be worth more than a company with a high yield. Fast-rising…
In recent decades, house prices have become a national obsession. Other countries across Europe seem to lack this constant focus on how much house prices have changed in the last month, quarter or year. However, in the UK the love of rising house prices looks set to stay in the long run. The reason for…
The FTSE 100 has surged 17% in the last year, but easyJet (LON:EZJ) has slumped 38%. For some investors, a large share price fall could dissuade them from buying. However, I’ve always been more interested in buying shares which have fallen in price. I think they often offer less risk, not more risk, and such…
