Pernod Ricard yields 5% – convincing enough?

Pernod Ricard’s stock has taken an almost unthinkable tumble, plummeting from a spirited high of over 200 EUR not too long ago in 2023 to even below 100 EUR now. That’s a 50% nosedive in just two years, while the broader markets – until they got a bit tipsy a few months back – were toasting new highs. The more so shocking, as Pernod Ricard is seen as a “recession-proof, high-quality company with valuable brands”. Is this a rare chance to grab a premium spirits stock at a bargain, letting its value intoxicate your portfolio? Or could it trap you in a value hangover?

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Is South Africa’s Sasol a steel at 0.4x book value?

Once a 40 bn. USD heavyweight, South Africa’s energy and chemicals company Sasol has imploded to a market cap of less than 3 bn. USD. South Africa primarily makes negative news, as the country is coping with political instability, a weak economy, high unemployment, the world’s highest inequality, a fragile energy and electricity supply and even recently announced legally allowed expropriations of white people. In this environment, the currency depreciated strongly. Is now the time to look for bargains in this crisis-ridden environment? A look at South Africa’s (former) giant.

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Consumer staples got eaten for lunch – Part II – Alcohol stocks

After my take on food stocks, in today’s second part of the series I am having a look at another failed group of consumer darlings – alcohol producers. These “sin stocks”, similar to tobacco, have been seen for long as one of the best ideas to play defense. Especially in crises, it was said people would smoke and drink even more. The only difference: valuations. While most tobacco stocks today are deep-value plays, alcohol stocks for a long time have had rather rich multiples. Frustrating for those who only looked at the perceived quality of the companies, but not their risks. With many alcohol companies trading substantially below their highs, is now the time to get active?

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Consumer staples got eaten for lunch – Part I – Food stocks

Weren’t we told stocks of consumer staples should be cornerstones of every mindfully assembled portfolio? With their defensive business models, predictable demand (one needs to eat, drink, clean, etc.), strong brands, consistent dividends and long histories as proof of being in business for a reason, this sounds like a no-brainer. Winning by not losing, everything else is too speculative, isn’t it? However, over the last five and even ten years, exactly this group of stocks has disappointed extremely. Many are in the red and even factoring in their dividends the performance was abysmal. Are valuations now cheap enough to take a bite?

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Retail crowd’s favorite REITs: disappointment likely to continue

REITs, or real estate investment trusts, are an asset class that is typically followed and bought by investors with a focus on cash flows in the form of dividends. One of the main arguments is that this way they don’t have to bother about stock price fluctuations, as their dividend income is safe. Sounds logical, but the long-term performance of three highly celebrated such REITs is simply weak. The worst thing, I am expecting this trend to continue or even to worsen.

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Halozyme Therapeutics – an overlooked bargain? + new stock idea

Feeling uncomfortable with everybody’s darling stocks, my motivation was and still is to find stock ideas with what I call “an own life”. With that I am looking for companies with internal triggers or catalysts which can influence shares positively (almost) regardless of what broader markets do. While I do not believe (for now) in a hefty stock market crash which pushes down all equities, I cannot rule out a nosebleed correction in the tech sector. In search of uncorrelated stock ideas, I spent some time on the Pharma / biotech sector. Halozyme Therapeutics is a seemingly lowly-valued stock. My Premium PLUS members have already received my latest potential-multi-bagger stock idea in an exclusive research report to kick off the year 2025.

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Warm-up for 2025 – better expect the unexpected

Despite having done a combined review-and-outlook Weekly already, I decided to write another one with the focus solely on the outlook for 2025. Over the last weeks, I have gathered new ideas, but also brought my thoughts in order during the days that I took off. There are a few other things I wanted to share. What could the next investing year have in store for us?

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Stocks of Dollar Stores – now finally a buy?

This Weekly is an update taking a second look at North American “dollar store” operators Dollar General and Dollarama. After almost exactly to the day two years ago, I featured both names in an analysis concluding that I have sympathies for the businesses as such, but not for their stocks. Something quite interesting has happened since: one stock totally cratered, the other advanced by another 75%. The development could not have been more different! What do both have in store now?

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Antitrust has come into fashion – Capri Holdings after its 50% crash

Back in May, I wrote about the stock of Capri Holdings, the owner of wannabe-luxury fashion brands Michael Kors, Versace and Jimmy Choo. My assessment was that despite looking like a bargain, the stock was too risky due to its weak execution on a business level with deteriorating fundamentals. Capri and competitor Tapestry were appealing the blocked takeover attempt by Tapestry which now has been called off for good by the Federal Trade Commission. Capri crashed by 50% in response to the announcement of the deal-freeze. Is the stock now cheap enough?

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Estée Lauder – after –75% still not pretty + dividend in danger

A common misconception is that lower stock prices are akin to cheaper shares. Without much explanation, it is logical that this can only apply when the underlying business has at least been stable. Otherwise it is possible that a stock even becomes more expensive! While this is not the case at Estée Lauder, despite a 75% drop from its all-time high, the stock is still looking ugly valuation-wise. A decent downside risk remains. On top, the likelihood for a dividend cut or even entire suspension is significant.

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