Defensive growth stocks have been an important part of their own portfolios for experienced and long-term investors for many decades.
Shares in consumer goods companies are particularly popular.
Correspondingly, stocks such as Heineken, Diageo or Colgate-Palmolive can be found on the price lists.
If you have a certain affinity for France, you cannot avoid a share that recently did not have so many investors on the radar in Germany: Pernod Ricard.
The French spirits manufacturer is known to consumers through brands such as Chivas Regal, Glenlivet (whiskey), Havana Club (rum), Monkey 47, Beefeater (gin) and Absolut Vodka.
The world's second largest wine and spirits company announced this week that it is expecting higher profits for the current year.
Pernod Ricard gets an unexpected rain of money from America in the form of a refund of import duties that would mean an additional pre-tax profit of $ 163 million.
This is not inconvenient for the French, as this sum corresponds to additional organic growth of almost one percent in the current financial year, after the entire industry was subject to the lockdown measures adopted in the wake of the Corona crisis as well as travel and travel expenses last year Had suffered contact restrictions.
The vaccination programs and the opening of the economy with the return of the restaurant business have made the French group more optimistic in recent months.
The recovery is progressing even faster than management had assumed.
Only the business related to the travel industry does not really want to start again because of ongoing restrictions.
Pernod Ricard will not present his figures for the 2020/21 financial year (end of June) until September 1st. Nevertheless, it should already be clear today that the group is back on track. In the first nine months, the company had already returned to organic sales growth. The recovery, which is progressing better than expected, and the austerity measures taken in the wake of the Corona crisis have even led to the forecast for growth in earnings from continuing operations for the full year being raised from the original 10 percent to 16 percent. In this way, the result from continuing operations should roughly reach the pre-crisis level of 2019.
Even before the outbreak of Covid-19, Pernod-Ricard had undertaken a comprehensive corporate transformation under the name "Transform & Accelerate", which would run until 2030. Among other things, four important regions and fields for future growth were identified with the United States, China, India and the global travel and tourism industry.
A medium-term growth target in the mid-single-digit percentage range was issued for the American market. In China, Pernod Ricard wants to grow in the high single-digit to low double-digit percentage range. In addition, the import share is to be doubled from 1 to 2 percent between 2017 and 2025. The growth initiative in China also includes strengthening e-commerce and the consumption of wine and spirits at home. The latter has proven to be an important initiative in the context of COVID-19. In India, meanwhile, Pernod Ricard wants to grow in the low double-digit percentage range in the medium term and, above all, to expand its market-leading position with a market share of around 45 percent.
The group already controls around a quarter of the travel and tourism market.
Despite the COVID-19 reset, a lot of potential is still seen here.
Accordingly, the French have their eyes on the top in the premium segment and market leadership in tourism retail.
Successful long-term investment
Despite all the problems and difficulties caused by Corona, Pernod Ricard has recently proven that investors can make money with the share.
Even in the crisis year, the share price rose.
Anyone who invested 10,000 euros in shares in the group ten years ago can now call almost 30,000 euros in the position their own.
A look at the development of the share price since 2019.
After the Pernod Ricard share climbed to a new record high of 178.80 euros in September 2019, prices fell by around a third to a peak of 117 euros by March 2020. But what followed was a steep catching-up movement, in the course of which the breakout above the 2019 all-time high succeeded in May of this year. After this strong buy signal, it went up to a new high of 189 euros by June, after which the price temporarily fell just below the 180 mark by the end of August. Despite the current correction, the trend arrows continue to point clearly upwards, as evidenced by the still large distance to the 200-day line (169 euros).
Since the share - despite all the crises - has been in a general upward trend since 2000, further increases in prices are realistic. Since 2000, the price has increased by an average of 12 percent per year. With the exception of a few years, such as in 2008 or most recently in 2020, the price development was very stable for most of the years, which is why the share is suitable for conservative investors, even if the current valuation with a 2020 P / E ratio of more than 30 is no longer cheap .Keywords: