HALISTER: BARRON’S ROUNDUP: Brexit Stock Picks, VW, Bullish on U.S. Banks

BARRON’S ROUNDUP: Brexit Stock Picks, VW, Bullish on U.S. Banks

(Bloomberg) -- Ryanair, GlaxoSmithKline and SAP are bargains after the U.K. referendum to leave the European Union, Barron’s said in its July 4 issue. Key takeaways include:
  • Spain looks to be one of Europe’s most attractive markets, and Credit Suisse analysts say its stocks are cheap based on normalized earnings. Companies with ties to Brazil such as toll road operator Abertis Infraestructuras (ABE SM) seem inviting as sentiment in Brazil improves.
  • SAP (SAP GY) could be worth 90 euros a share in a year, against Friday’s close of 67.40, according to Credit Suisse analyst Philip Winslow; discount airline Ryanair Holdings (RY4C EU) was cited as a buy by money manager Kuldip Shergill at Cheyne Capital. Electrical equipment maker Rexel (RXL FP) was oversold, he said.
  • Howden Joinery Group (HWDN LN), which sells kitchen and joinery products to the trade, was also oversold. Persimmon (PSN LN) was cited by Aubrey Capital’s Sharon Bentley- Hamlyn, who added to her holdings in the homebuilder.
  • Household products maker Reckitt Benckiser Group (RB LN) and tech company ARM Holdings (ARM LN) were cited by Martin Schulz of PNC Capital Advisors; GlaxoSmithKline (GSK LN) was cited by Franklin Mutual European fund’s Katrina Dudley.
  • Dixons Carphone (DC LN), Marks & Spencer Group (MKD LN) may remain cheap if UK consumers curb their spending.
Other highlights from this week’s magazine (subscription required):
  • U.S. banks and asset managers could represent one of the best values in the market and may return between 6% to 10% of their market values in the next 12 months. Goldman Sachs (GS), Citigroup (C) and Morgan Stanley (MS) are among the bargains.
  • Southwest Airlines Co. (LUV) isn’t affected by Brexit since its main business is within the U.S. Analysts says shares could hit $53 against Friday’s close of $39.60. Company is expected to grow earnings at 9% a year and stock has 1% dividend yield.
  • Volkswagen (VW) shares, battered by the emissions scandal, could surge 20% over the next year now that the $15.3 billion U.S. settlement has been reached.
Alert: HALISTER
Source: BFW (Bloomberg First Word)

Tickers
VOW GR (Volkswagen AG)
C US (Citigroup Inc)
GSK LN (GlaxoSmithKline PLC)
MKS LN (Marks & Spencer Group PLC)
RYA ID (Ryanair Holdings PLC)

People
Kuldip Shergill (Cheyne Capital Management Ltd)
Martin Schulz (PNC Capital Advisors LLC)
Philip Winslow (Credit Suisse Holdings USA Inc)

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