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5 favorite stocks of Victor Zwart

18 January 2014, De Tijd

Google > Internet technology

Google is still creating economic value for its shareholders. Everyone knows Google as a search engine, but the company is more than just a robot churning out search results. Google is also YouTube, Android and Chrome. In addition, the company is performing well in the areas of mobile telephony and the Internet.

In recent years, the yield on capital invested has been an average of 15%. The company generates a very high level of free cashflow and has few debts. The stock price may appear to be on the high side, but it’s mainly an optical illusion. The price-earnings ratio is 17.

CVS Caremark > pharmacy chain

CVS Caremark provides pharmaceutical services via its more than 7,000 pharmacy outlets, its pharmacy division and the health clinics owned by its subsidiary, MinuteClinic.

The group has published excellent forecasts for 2014. Across 2013, the profit per equity will come out at 15% higher. The group expects to see a further rise of 10 to 14 per cent in 2014. Turnover is expected to increase by 5%. Because we see the pharmaceuticals sector growing significantly in the long term, due in part to Obamacare, CVS has firm foundations for sustained success.

EMC Corporation > data storage

The American company, EMC, offers storage capacity for data security, technical archiving and ‘in the cloud’ services. It has customers across many sectors, such as financial services, healthcare, Internet service-providers, aviation, education and the biotech industry.

The company’s share price has been under pressure since August. This can be attributed to lower spending by the government, one of EMC’s most important customers. But in view of the recovery in the American economy, we expect to see an increase in the price of this undervalued equity.

Orpea > care for the elderly

Orpea is a French operator of approximately 350 homes for the elderly and clinics (Clinea), focusing on psychiatric care, follow-up care and rehabilitation. The company has branches in France, Spain, Belgium, Italy and Switzerland.

Turnover in 2007 was barely 500 million EUR, whereas last year it set its sights on € 1.6 billion. Profitability is along the same lines, with the average rise in profit exceeding 11 per cent over the past five years.

Orpea is an appropriate equity for capitalising on the increasing greying of the population in the eurozone.

Dover Corporation > industrial solutions

Dover Corporation is a diversified worldwide operator with annual sales in excess of 10 billion dollars. The company operates in four major segments: communication technologies, energy, technical systems (including freezers for the food sector) and printing and identification (the encoding of consumer goods).

The growth in profits over the past 5 years has been 15 per cent. We expect profits to increase by the same amount over the coming years. Dover has boosted its dividend for the past 58 years in a row. Not many companies can say that.


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