Three stocks to make your portfolio hum
There is (almost) nothing more delightful than a good stock picker who’s passionate about why he or she chooses to invest in a certain company.
I especially respect the fund managers who take a hard look at the numbers and then make time to meet with management of a company. And I love the ones who, added to that, inject a solid dose of simplicity and common sense to their investments.
Alex Gunz, manager of the Helicon Global Equity fund for Heptagon Capital, is a man who does all four. Let me share three of his latest stock picks with you, and what Gunz has to say about them:
- Activision Blizzard is the dominant player in the video gaming industry, and Heptagon has been invested in the company since February of this year. One of the most striking things about the group is that it has more than 500m monthly users playing games via its platform. If you compare that to the number of people on Twitter, Netflix and Spotify, you have more people using Activision than the three other groups combined. In the video gaming industry “content is king”, and Activision benefits from the leading console franchise, Call of Duty, and the leading mobile franchise, Candy Crush. The company has a solid pipeline of games, and it just launched its first brand new game franchise in 17 years called Overwatch which should help spur even more demand. In fact, over 9m people have already signed up to the trial.
- Booker Group is the UK’s leading food and grocery wholesale business. The company has a top management team and the group has a solid strategy in place with focus on consistently cutting costs, improving customer service and delivering organic growth through product innovation. Booker recently reported solid results and it is winning market share in the sector. Furthermore, the company is generating lots of cash and is actively returning money to shareholders.
- SCA is one of the top three global players in consumer hygiene, and its products range from baby nappies to feminine care to incontinence lines. The group is benefiting from long-term structural tailwinds, with a combination of urbanisation and demographics helping to drive demand for its products. Relatively new management is improving the business via product innovation and cost control. One of the additional gems for SCA is that it owns 2.6m hectares of forest land, equivalent to the size of Belgium, making it the largest private forest owner in Europe. This could be key to unlocking additional value over time. Currently, timber from SCA’s own forest accounts for 50 per cent of the group’s wood consumption, making it one of the most efficient players in this space.
By all means, do your own research and take a look at these companies. For the record, Heptagon Capital is invested in these three stocks in at least one of its products, so Gunz is putting money where his mouth is. Have a good summer!