Saturday, 19. August 2017  
16.08.2016 21:33
Author: Alex Waber

STOCK SCREEN: European Large Caps With Significant Upside Potential

 

Industrial production in the U.S. rose by 0.7% m/m in July. While still down 0.5% yr/yr IP may be near a turnaround after firms pared back on factory activity over the last year. Global equities have moved higher in line with improving global macro surprises, allowing global earnings revisions to turn positive for the first time since 2012.

 

An increased correlation between equity markets and macro surprises suggests that equities have become more sensitive to changes in economic momentum compared to last year. But while in Europe macro surprises have been significantly positive since the beginning of the year, the broader stock market did not as well as in the U.S. Over three years the performance gap between both markets is about 41 percent including currency, with the S&P up 65 percent and Europe up 24 percent.

 

In looking for ideas this week, we screen for European stocks with the high upside according to our fair value estimates.

 

Here are the filter criteria:

1. Market capitalization above 1bn.

2. Above 20% Margin-of-Safety based on our 3 valuation approaches.

 

Here is our list of stocks matching all criteria in alphabetical order. Company names in the table below are linked to the ANALYZER, our single stock analysis tool. Intrinsic Value Model assumptions can be adapted in the MODELER, our modeling and forecasting environment:

CLICK COMPANY NAME FOR DETAILED STOCK VALUE ANALYSIS

INDUSTRY

LAST PRICE

MARKET CAP.

MEAN MULTIPLE UPSIDE [%]

GRAHAM UPSIDE [%]

GREENBLATT UPSIDE [%]

DIVIDEND YIELD [%]

 AGGREKO PLC

 Commercial Services

1057.00

2707

53.5

28.1

46.1

2.6

 ARCADIS NV

 Construction

12.06

1038

57.7

63.9

53.3

4.7

 BAYERISCHE MOTOREN WERKE AG

 Car Manufacturers

79.06

51242

206.5

88.7

165.5

4.2

 BERKELEY GROUP HOLDINGS

 Home Builder

2488.00

3416

40.3

71.0

99.5

8.0

 BILFINGER SE

 Construction

27.13

1248

109.6

39.1

41.2

2.4

 CASINO GUICHARD PERRACHON

 Food

44.43

4975

118.2

188.2

126.4

7.0

 CHRISTIAN DIOR SE

 Apparel

162.65

29360

84.0

146.5

136.0

2.5

 CREST NICHOLSON HOLDINGS

 Home Builder

436.80

1109

46.9

44.5

109.8

6.4

 DAIMLER AG-REGISTERED SHARES

 Car Manufacturers

62.11

66448

24.9

53.2

95.4

5.3

 DANIELI & CO

 Constr. & Mining Machinery

17.13

1205

253.8

156.9

137.2

0.8

 GAZTRANSPORT ET TECHNIGA SA

 Construction

28.22

1046

74.4

30.1

20.9

9.5

 GREAT PORTLAND ESTATES PLC

 REITS

650.00

2236

32.9

21.0

185.4

1.4

 NN GROUP NV

 Insurance

24.14

8007

27.7

32.7

42.9

6.1

 POSTNL NV

 Transportation

3.90

1729

71.4

99.2

96.4

0.0

 SPORTS DIRECT INTERNATIONAL

 Retail

293.40

1751

93.6

44.2

57.0

0.0

 SWATCH GROUP AG/THE-BR

 Retail

267.20

14790

51.9

28.9

30.5

2.5

 TECHNIP SA

 Oil & Gas Services

50.07

6124

76.2

60.3

55.5

3.9

 TECNICAS REUNIDAS SA

 Construction

31.82

1779

50.9

57.7

31.2

4.3

 VIENNA INSURANCE GROUP AG

 Insurance

16.93

2166

91.0

84.2

48.2

4.6

 VOLKSWAGEN AG-PREF

 Car Manufacturers

122.60

63461

171.4

93.2

59.5

2.2