Seven Hot European Stocks
The European situation was the focus at this past weekend's G20 meeting. Even as a bailout of Greece seems to be all but set, several eurozone members teeter on the brink of recession. On top of that comes the backlash from Iran over sanctions due to its nuclear development efforts.
See also: Merkel Warns Against Abandoning Greece
But even in times of uncertainty there are opportunities for the investor. The following publicly traded European companies are on a roll. That is, their stocks are more than 25% higher year to date and still have momentum. They are all traded on U.S. markets and have market caps of more than $1 billion.
Alcatel-Lucent's (NYSE: ALU) share price is more than 66% higher year to date, including a more than 6% rise in the past week. The Paris-based communication equipment maker recently won a bid to build a nationwide high-speed wireless network in Spain. Alcatel's market cap is $6.0 billion. Its P/E ratio is 7.6, its P/B ratio is 1.1, and its return on equity is 20.6%. Over the past three months, the stock has outperformed Cisco Systems (NASDAQ: CSCO) and Juniper Networks (NYSE: JNPR).
Barclays (NYSE: BCS) shares are trading almost 43% higher year to date, and more than 87% higher than the 52-week low last September. Yet, the London-based money center bank posted disappointing Q4 results. It has a market cap of $47.3 billion and its dividend yield is 2.5%. The long-range EPS growth forecast is 28.8% and the PEG ratio is 0.3. Over the past six months, the stock has outperformed peers Deutsche Bank (NYSE: DB) and HSBC Holdings (NYSE: HBC).
Compagnie Generale de Geophysique-Veritas (NYSE: CGV), or CGG Veritas, is up more than 30% since the beginning of the year, and more than 100% from the 52-week low. The oil and gas production service provider is scheduled to announce fourth-quarter results on March 1. The French company has a market cap of $4.6 billion. The long-term EPS growth forecast is 44.7%. Over the past three months, the stock has outperformed peers such as National Oilwell Varco (NYSE: NOV).
Delphi Automotive (NYSE: DLPH) is up more than 45% year to date and reached a new 52-week high on Friday. The UK auto parts maker had its IPO in November, and it is one of the top holdings in John Paulson's portfolio. The P/E ratio is 8.9, the return on equity is 31.3% and the long-range EPS growth forecast is 40.8%. Its market cap is $10.3 billion. The stock has outperformed the likes of Magna International (NYSE: MGA) and TRW Automotive (NYSE: TRW) year to date.
Foster Wheeler's (NASDAQ: FWLT) share price rose more than 5% in the past week to more than 31% higher than at the beginning of the year. Fourth-quarter EPS grew year over year, but missed consensus expectations. The Swiss construction and engineering company has a market cap of $2.7 billion. The long-range EPS growth forecast is 12.6% and the return on equity is 19.5%. Over the past six months, the stock has outperformed Fluor (NYSE: FLR) and Jacobs Engineering Group (NYSE: JEC).
Seagate Technology (NASDAQ: STX) is trading more than 64% higher than at the beginning of the year. Shares surged at the end of January when the Irish hard drive maker said that its fiscal second-quarter net income more than tripled from a year earlier. The $12.0 billion market cap company has a dividend yield of 3.7% and its return on equity is 29.3%. The stock has outperformed peers NetApp (NASDAQ: NTAP) and Western Digital (NYSE: WDC) over the past six months.
VimpelCom's (NYSE: VIP) share price is up almost 31% year to date but still down more than 11% from the 52-week high. The Dutch telecom is expected to say in its March 13 quarterly report that revenues more than doubled year over year. It has a dividend yield of 6.4% and an operating margin higher than the industry average. Short interest is 0.4% of the float. The stock has outperformed the likes of Mobile Telesystems OJSC (NYSE: MBT) since the beginning of the year.
Bullish: Investors interested in other European stocks with momentum may want to consider the following trades:
- Autoliv (NYSE: ALV) is more than 27% higher year to date.
- SAP (NYSE: SAP) is more than 26% higher year to date.
- Ensco (NYSE: ESV) is more than 25% higher year to date.
- Chicago Bridge & Iron (NYSE: CBI) is more than 25% higher year to date.
Traders may prefer to consider these alternative positions:
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Tags: Alcatel-lucent, autoliv, Barclays, CGG Veritas, chicago bridge & iron, Cisco Systems, Delphi Automotive, Deutsche Bank, Empresas ICA, ensco, European stocks, fluor, foster wheeler, HSBC Holdings, jacobs engineering, Juniper Networks, Lions Gate Entertainment, Magna International, Mobile Telesystems OJSC, National Oilwell Varco, NetApp, SAP, Seagate Technology, Tata Motors, TRW automotive, vimpelcom, western digital