Three Global Stocks Worthy of Long Term Investment
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Global stocks are still a good investment despite regional weaknesses. Companies that have very strong balance sheets, attractive valuation today, strong cash flow generator and a market leadership position are the types of companies one should look for. Here are three global stocks to consider for long term investing.
Vodafone (NASDAQ: VOD), which owns 45 percent of Verizon Wireless (NYSE: VZ) in the U.S., may be a good pick for a stock that is over sold presently because of the European debt crisis. This company is a pure investment on wireless international growth. Vodafone is a U.K.-based telecommunication firm with operations in over 30 countries. Another piece of information that makes VOD attractive is its dividend. The company pays a bi-annual dividend with the final amount typically double that of the initial amount. The current yield is around 5% and with Verizon contribution attached, it comes to about 7.23%. This makes the stock look very attractive to income investors.
Lately there has been talk about a buy out or even a merger involving itself and its wireless partner Verizon Communications. The fact that Verizon Wireless has dragged its feet paying out dividends to its parent companies opens speculation something bigger may be in the works between both parent companies. Whether it might be buyout or merger, Vodafone shareholders are looking for equity from somewhere as it relies on its U.S. child for more profits. As the European crisis fixes itself over time and the stake in Verizon wireless grows, this company should continue to grow paying out a nice dividend.
Kia Motors (KIMTF), is a company that has done well since 2008. Just in the U.S. the company has increased market share up by 38% since 2008 and up for the 15th consecutive year. With more than $1.3 billion invested in the U.S. market in the last five years, the Kia family of companies continues to progress here. Despite unprecedented market challenges in 2009, KMA’s 2009 sales surged past the 300,000 mark for the second time in company history. And in 2012 it reported its best January sales ever, up 28.7% over 2011. As late as June, sales were up 13.9% over the previous year.
Not only is it growing in the U.S., but it is also growing in Europe of all places. For all of 2012 a forecast calls for Kia to sell 340,000 vehicles against about 200,000 only four years ago, giving it market share of 2.6%. Home grown European companies like PSA Peugeot-Citroen (UG.MI) and Fiat Spa (F.MI) are cutting costs because of poor sales while Kia’s unit sales grew by 23.4% the first half of this year. While the market as a whole fell by 6.6% Kia was the only mass market brand to grow. Kia must be doing something right if consumers are buying its cars in markets like this.
Intel (NASDAQ: INTC) is a third company to consider as it delivers a 25-percent return on equity. Much has been written about the struggling stalwart as it tries to move with the ever evolving markets. Even though semiconductor chips have been down, Intel has some bright spots. As late as last year, the global tech giant saw its lead over Samsung in the global semiconductor market grow to 6.5 percentage points, thanks to strong microprocessor and flash memory sales. It continues to extend its dominance in the strong microprocessor and NAND flash memory sectors and leveraging its acquisition of earlier this year of Infineon Technologies' wireless chip business.
And Intel is leading the charge to create a type of “consumer loyalty” for its chips. It is extending its dominance in the strong microprocessor and NAND flash memory sectors and leveraging its acquisition of earlier this year of Infineon Technologies' wireless chip business. The Intel logo can be seen on smartphones from Great Britain to Russia. Brian Fravel, Intel's head of branding, stated:
"Without a doubt, my goal would be to have consumers walk into stores and have Intel Inside as a key driver of which phone or tablet they choose, just like we've done in the PC space."
The company is a global leader and will continue to be as it moves into the mobile market.
Vodafone, Kia, and Intel are examples of three different global companies that are growing in different ways in a very challenging macro economic environment. But each has proven profits can be made. These are three choices of good long term investments for a global stock making it in this challenging environment.
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johnmylant has no positions in the stocks mentioned above. The Motley Fool owns shares of Intel. Motley Fool newsletter services recommend Intel, Vodafone Group Plc (ADR), and Vodafone Group Plc (ADR). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.