Watchlist update: February

In the middle of every month I will update my current stocks watchlist, and post a top 3. Below are my reasons for looking at these stocks, for current valuations and a list of 25 stocks please visit my ‘Watchlist’ page.

I will explain my top 3 watchlist stocks briefly based on sentiment, P/E ratio and ‘% off 52 week high’:

  • Sanofi counts three segments, medicine for animals, humans and vaccins. Human medicine produces about 80% of their revenue. The states and emerging markets are about 30% of their revenue each, Europe is about 20%. They are listed on the Paris Euronext market and have seen a bloody year, they are down to €64,09 from a 52 week high of €92,97, this makes their current P/E ratio a decent 21.32. In 2017 the board announced a dividend of €3.03 per share, a 2,4% increase from 2016, this meant their 24th year of consecutive dividend increases which means they could become a Dividend Aristocrat in 2018. They currently yield 4,73% and pay their dividends once a year in May. Since 2008 their dividends grew by average 3,7% a year, not a lot, but for a security yielding this much it’s fine with me. This would be a value play, with great dividends and would give me more exposure to my own currency and continent.
1 year chart of Sanofi.

 

  • IBM is an age old company, with their roots in 1888. International Business Machines as their full name is, has registered the most patents in the world for 19 years in a row. Their business is so huge that people refer to them as ‘Big Blue’ because of their logo and company size. IBM has been a company in transition for a long time now, they reported 22 quarters of declines but they finally broke this trend last quarter. There might be light at the end of this tunnel, as IBM is maybe one of the frontrunners of A.I. (Artificial Intelligence) with Watson, and also they might be one of the frontrunners in the new and very popular blockchain technology (the tech behind for example Bitcoins). They have paid dividends for more than 100 years, and their recent streak of increasing dividends is 22 years which gets them close to the Dividend Aristocrat status. With a wide business, promising future technologies, a P/E of just 12.95, 14,56% below their 52 week high, a 5-year dividend growth rate of 12,90%, and a yield of 3,84% this could be a great long-term addition to any portfolio!
1 year chart of IBM.

 

  • Amgen is the biggest independent biotechnology company in the world. It has partners like Pfizer, GlaxoSmithKline and more. Their five biggest drugs Enbrel, Neulasta, Aranesp, Epogen, and Neupogen are experiencing declining sales but never the less the company increased their bottom-line with double digits and said it wants to do the same in 2018. This is partially made possible by their drug called ‘Prolia’ which has sold 22% more than last year and is believed to be one of their best selling drugs in the next couple of years. They are currently 8,79% below their 52 week high, at a P/E of 16.69. Nothing shocking, but in these market conditions it looks like a very solid deal! Yielding just under 3% with a 5 year dividend growth rate of 26,90% you are in for some serious dividend growth with Amgen. Although they only have paid and increased their dividend for 7 years, management seems focussed on returning profit to their shareholders through dividends. To acquire one of the worlds biggest biotech companies at these conditions would be fine deal!
1 year chart of Amgen.

 

What are your top picks for the next month? Let me know!

Happy investing!

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2 Comments

  1. Interesting watch list! No reits in the picture since they’ve been hammered lately?

    I own IMB and Amgen has been on my list for a while as well but haven’t pulled the trigger yet.

    • DutchIndependence

      Hey Robot! For sure I have some reits on my list, such as O, VTR and LTC but due to interest rates rising I am hoping to get in a little later for a better price. I am already exposed to O with 30 shares so I am not in a rush. Thanks for your comment!

      DI

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