Investment theme: Consumer Services
Strong consumer sentiment is driving the market. Asian related business activity should improve in due course, while Europe is lagging behind average market development.
Our list of favorites:
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Monster Beverages | MNST | Soft drinks | 20.5 % | 4.22 |
| Investment case: Regulation concerns should disappear over time. MNST shares rose as much as 4% after the release of its Q4 earnings which came in better than expected. There is more to come. |
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| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Delta Air Lines | DAL | Airlines | 17.7 % | 3.41 |
| Investment case: US domestic traffic could grow by about 5% in 2014. This coupled with moderating costs, offers investors a good yield opportunity. Delta said traffic climbed 2.4% month-on-month in February. | ||||
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Estee Lauder | EL | Cosmetics | 10.7 % | 5.66 |
| Investment case: Structurally EL is in a good position as it serves both mature and growing economies. Sales of EL are better accross the globe; full year 2013 fiscal sales climbed by 5%. | ||||
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Michael Kors | KORS | Cosmetics | 11.7 % | 3.67 |
| Investment case: Kor’s fiscal Q3 profit soared 77% on strong holiday sales, there is more to come. | ||||
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| PVH Corp | PVH | Clothing & Accessories | 11.7 % | 3.67 |
| Investment case: Growth is accelerating. PVH’s brand, Tommy Hilfiger’s European sales rose 7% in fiscal Q4. PVH stocks currently deal at a discount to its peers. | ||||
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Dollar General | DG | Speciality Retailer | 14.0 % | 4.94 |
| Investment case: All the bad news is in the price. | ||||
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Dollar General | DG | Speciality Retailer | 14.0 % | 4.94 |
| Investment case: All the bad news is in the price. | ||||
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Adidas | ADS | Footwear | 16.2 % | 4.74 |
| Investment case: The shift in ADS’ sales culture should unlock substantial value for shareholders. | ||||
| mpany | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Amazon | AMZN | Broadline Retailer | 40.3 % | 4.67 |
| Investment case: AMZN has a number of “irons in the fire” at the moment: a) It just launched a new TV service, b) the Kindle device ecosystem is benefiting from an increase in popularity, and c) the company has excellent competencies in eCommerce activities. Finally, the online retail food market could provide the company with a massive untapped market opportunity. | ||||
| Potential | Sharpe (FY01) | |||
| Monster Beverages | MNST | Soft drinks | 20.5 % | 4.22 |
| Investment case: Regulation concerns should disappear over time. MNST shares rose as much as 4% after the release of its Q4 earnings which came in better than expected. There is more to come. |
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