5 Strong Worldwide Stocks

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5 Strong Worldwide Stocks

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Identifying strong worldwide stocks in today’s market requires focusing on companies with durable competitive advantages and solid growth potential. In this article, we highlight 5 strong global stocks, carefully selected by Morningstar experts for their undervalued status and long-term resilience.

Let’s dive in.

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5 Strong Worldwide Stocks

Huntington Ingalls (HII) – U.S. Defense Powerhouse

A stable defense contractor with long-term U.S. Navy contracts and predictable cash flows.

• Price/Fair Value: 0.60 (40% discount to fair value of $326 per share)

• Defense Industry Leader: Largest independent U.S. military shipbuilder, ensuring steady demand.

• Long-Term Contracts: Builds aircraft carriers and submarines under multi-year agreements.

• Stable Cash Flow: Less affected by short-term defense budget changes.

• Dividend Strength: Generates strong free cash flow, making it a solid income stock.

• Geopolitical Tailwinds: Increasing global military spending supports long-term revenue growth.

Estee Lauder (EL) – Luxury Beauty Leader

Premium beauty brands, a strong digital presence, and a strategic turnaround make Estee Lauder a compelling buy.

• Price/Fair Value: 0.53 (47% discount to fair value of $162 per share)

• Deep Brand Portfolio: Owns luxury beauty brands like Clinique, Aveda, and Estee Lauder with strong customer loyalty.

• Omnichannel Strength: Strong digital and retail presence helps drive revenue growth.

• Leadership Transition: CEO change has created uncertainty, but the Lauder family’s influence provides stability.

• Cyclical Risk: Premium beauty products are sensitive to economic downturns.

• Turnaround Potential: Plans to refresh product offerings could accelerate future growth.

Rentokil Initial (RTO) – Pest Control Market Leader

A fast-growing pest control giant benefiting from acquisitions and recession-resistant demand.

• Price/Fair Value: 0.62 (38% discount to fair value of $40.30 per share)

• Acquisition Strategy: Has completed 200+ acquisitions to strengthen market dominance.

• Terminix Deal: Became the U.S. market leader after acquiring Terminix in 2022.

• Recurring Revenue: Pest control services provide stable and predictable cash flows.

• Cost Efficiency: Acquisition synergies create long-term cost advantages.

• Defensive Industry: Essential services ensure demand remains strong in any economy.

Yum China (YUMC) – Fast-Food Growth Engine

A dominant fast-food operator in China with massive long-term expansion opportunities.

• Price/Fair Value: 0.63 (37% discount to fair value of $76 per share)

• China’s QSR Leader: Owns KFC, Pizza Hut, and Taco Bell, with a growing presence.

• Expanding Footprint: Despite economic challenges, new store openings continue.

• Market Potential: China’s $700 billion restaurant industry offers huge growth potential.

• Franchise Strength: Low capital intensity due to strong franchise operations.

• Consumer Tailwinds: Urbanization and rising incomes support long-term demand.

Constellation Brands (STZ) – Premium Beer & Spirits Leader

A market leader in premium alcohol brands with strong pricing power and consistent demand.

• Price/Fair Value: 0.63 (37% discount to fair value of $274 per share)

• Mexican Beer Powerhouse: Owns Modelo and Corona, two of the best-selling beers in the U.S.

• Premiumization Strategy: Benefiting from the shift toward higher-end alcohol.

• Innovation Pipeline: Constantly launching new products to drive growth.

• Strong Market Share: Gaining ground despite a stagnant beer industry.

• Brand Loyalty: Consumers remain highly engaged with its portfolio.

For further guidance on investing, get The Money Master Blueprint—A guide to building and sustaining wealth.

The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.

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