Investors with a bon appetit for cream-puff stocks are now looking to a nation not famous for its friendliness — friendliness to corporations, that is.
France, land of exquisite small patisseries and bijou boutiques, is, as Forbes makes a case for investors, “home to some of the world’s finest companies – including oil major Total (TOT), fashion and luxury goods powerhouse LVMH (LVMUY) and pharma giant Sanofi (SNY) to name a few. Think about it. Only the crème de la crème could survive and thrive in a place as hostile to business as France.”
Charles Sizemore, founder and editor of The Sizemore Investment Letter, suggests taking a look at iShares MSCI France ETF (EWQ). “As the fears of a Eurozone breakup recede with each passing day, I expect investors to warm to French stocks over the course of 2013,” Sizemore says.
“I also like the fact that EWQ is weighted heavily in industrials and consumer cyclicals (17% and 15% of the portfolio, respectively),” he writes.
Bloomberg points out that French stocks are having their best year since 2009, but pushing the success of some French companies such as Michelin is the business they do outside of France.
“Michelin, which already gets almost 60 percent of sales outside Europe, said in October it plans to invest as much as 2.2 billion euros a year through 2015 to further expansion outside its home market. The world’s second-largest tiremaker has gained 56 percent this year, the biggest gain on record,” Bloomberg says.
BetterInvesting Magazine in October featured an article on the French energy company Total. Writer Nic Van Broekhoven noted that: “Total’s stock price is supported by a generous dividend policy. Total currently pays $3 per share. This means a dividend yield of almost 7 percent and a possible floor for the stock price.
“Total’s reserve replacement ratio (RRR) has been higher than 100 percent for the last decade. This indicates that the company’s replacing more of the oil than it pumps up, absolutely necessary for an oil major that wants to stay in business.”
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