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Investing alongside you, Foolish investors, here’s a selection of listed companies that some of our contributors have bought over the past month!
Anglo American
What we do: Anglo American is a global mining company, with operations in 15 countries.
By Andrew Mackie. At Anglo American (LSE: AAL) share price has seen big swings throughout 2022. However, this is par for the course when investing in mining stocks.
Although the short-term economic outlook may dampen the share price, in the medium and long term, I am very confident about the company’s prospects. Decarbonisation of the world’s energy and transport systems is very metal- and mineral-intensive.
As the pace of transition accelerates during this decade, demand for many metals will increase. However, what is not currently reflected in the price of the metal are supply-side constraints. Years of overinvestment in the natural resource sector mean we are facing a supply gap.
Exacerbating the problem is the skills gap in the mining sector. Finding qualified exploration geologists is becoming increasingly difficult due to a number of factors. Therefore, it was no surprise that I bought some stocks for my portfolio last month.
Andrew Mackie owns shares in Anglo American.
Apple
What we do: The company designs and manufactures consumer electronics. The most popular product is the iPhone.
By Stephen Wright. I don’t feel the need to make it too complicated now. That’s why I bought it Apple (NASDAQ:AAPL).
The company has all the features I look for in a stock to invest in. It is easy to understand, produces a lot of cash, and it does not take much active investment to run.
Apple has two sources of revenue. Hardware operations include selling products to consumers and service businesses earn money by cutting sales from App stores.
Businesses are also protected from competition. When users join the Apple ecosystem by buying their products, it becomes difficult to switch.
With shares down 37% over the last 12 months, I think this is the best time to invest in Apple stock. That is why I have bought stocks for my portfolio.
Stephen Wright owns shares in Apple.
Argentex
What we do: Argentex offers foreign exchange services to corporate and individual clients, offering customized advice and strategies.
By Roland Head. Argentex (LSE: AGFX) published a trading statement that increased its profit guidance for 2022 on 12 December. Shortly after this, I bought shares.
I’ve been watching this small cap for a while, because it seems cheap to me for a company with 25%+ operating margins and plenty of cash. Other attractions include owner management (the CEO owns 12%) and a worthwhile dividend.
However, growth stops in 2021. I wonder if Argentex can return to growth before doing its own fund.
The December update makes me believe that the company’s investment in new technology and recruitment is starting to pay off. Profits rose 26% during the first half of last year. I think there is more to come.
One caveat is that this is a competitive sector. There is no guarantee that Argentex will be a long-term winner.
But for now, I think the stock looks reasonably priced with good growth potential.
Roland Head owns shares in Argentex.
Ashtead
What we do: Ashtead is an international construction equipment rental company operating in the US, UK, and Canada.
By Edward Sheldon, CFA. I bought it Ashtead (LSE: AHT) shares for a number of reasons.
The main reason is that I expect companies to benefit from onshoring supply chains in the US. Currently, the US is undergoing a major reshoring initiative to eliminate supply chain vulnerabilities. This is likely to create high demand for construction equipment in the coming years.
Another reason is that I am impressed with the company’s interim results. For the half year to October 31, Ashtead’s revenue was up 26%. On the back of this strong H1 result, it raised its guidance for the year and raised its interim dividend by 20%.
Finally, the price seems reasonable to me. When I bought the stock, the P/E ratio was around 16.5.
As far as risk here goes, the one I’ll be watching is the state of the US economy. If the US falls into a deep recession and construction stops, Ashtead could suffer.
However, I feel that this stock can generate solid returns over the medium to long term.
Edward Sheldon owns shares in Ashtead
Games workshop
What we do: Workshop Games designs, manufactures and sells fantasy miniatures for the Warhammer tabletop gaming experience.
By Zaven Boyrazian. Games Workshop is the mastermind behind the world’s most popular tabletop franchise, Warhammer. It is undoubtedly a consumer-discretionary business. However, despite the pressure from rising inflation and a drop in consumer spending, revenue proved to be very resilient.
Looking at the latest trading update, pre-tax profits are expected to decline by around 6% compared to 2021. However, when examined closely, this decline comes from the timing of various license contracts rather than a reduction in product demand. In other words, core cash flow is still developing. So, management just raised the dividend by 68%!
Strong fundamentals combined with depressed stock prices often produce buying opportunities. And while 2023 could be a tough year if the UK goes into a deep recession, the long-term potential of this business remains huge. At least, I think so. And that’s why I added this business to my portfolio in December.
Zaven Boyrazian owns shares in Games Workshop.
Li Auto
What we do: Li Auto is a Chinese electric vehicle manufacturer founded in 2015 and headquartered in Beijing.
By Dr. James Fox. I have limited exposure to growth stocks, so when I buy one, it has to be for a very good reason.
Li Auto (NASDAQ:LI) is one of the most promising electric vehicle (EV) outfits. EVs are clearly part of the future, but the interest in Li starts with an attractive price.
The Beijing-based company is underperforming its US peers by many metrics, and may become the first Chinese EV company to turn a profit this year.
China’s zero-Covid policy poses problems for Li and his colleagues in 2022. Lockdowns and restrictions put supply chains under pressure and demand begins to decline.
However, preliminary data suggests that the company outperformed its peers in the latter half of 2022 and should achieve faster top-line expansion and positive normalized earnings in 2023.
I predict a stellar year for the firm, buoyed by China’s reopening and outstandingly impressive L9 SUV – check it out.
James Fox owns shares in Li Auto.
Modern
What we do: Moderna is an American biotechnology company focused on RNA therapeutics.
By John Choong. though Modern (NASDAQ:MRNA) has gained a lot since the pandemic, I believe that the current level is quite profitable.
The main revenue stream of the Covid vaccine is likely to decrease, which has led many analysts to downgrade the stock. However, the pipeline of shots for flu and respiratory syncytial virus could provide support to the top and bottom lines in the short to medium term.
But what I am interested in is the quest for a vaccine treatment for cancer. The company’s latest phase two trial for skin cancer shows a lot of promise and will move into phase three later this year. If successful, analysts suggest that Moderna could be a money spinner because the cancer vaccine could generate revenue of up to $1 billion a year, and $5 billion if its application extends to melanoma.
So, with a price-to-earnings (P/E) ratio of 6.6, a price-to-earnings growth (PEG) ratio of 0.1, and an enterprise value-to-EBITDA of 4.4, I’ve got the stock.
John Choong holds a position at Moderna.
Move right
What we do: Rightmove operates the UK’s most popular online property portal and largest property marketplace.
By Ben McPoland. Move right (LSE:RMV) is down 25% over the past 12 months. Which is understandable given the fact that higher interest rates make mortgages more expensive and reduce demand in the housing market. These risks could cause stocks to decline in the short to medium term.
However, I am taking a longer view with buying Rightmove shares. This is a company that has 84% market share. It is very profitable, with an asset-light business model generating an operating margin above 73%.
Righmove also has no significant debt, which is important given the higher interest rates. Additionally, the stock currently has a forward price-to-earnings (P/E) ratio of 22. The lowest it has been in years.
I don’t see people’s desire to hunt for their dream home changing. And I expect online property browsing to only increase in the future, benefiting from the company’s platform for years to come.
Ben McPoland owns shares in Rightmove
Vodafone
What we do: Vodafone operates a telecommunications network, and provides services such as mobile and broadband throughout Europe and Africa.
By Christopher Ruane. I have been thinking about buying shares in the telecom giant Vodafone (LSE: VOD) for some time. So what made me finally decide to move?
The underlying investment case has not changed, in my view. As a leading operator in many markets across Europe and Africa, Vodafone is poised to benefit from demand for services like broadband and mobile data. Set against the company’s large debt pile, which risks eating into the company’s profit.
But what has changed is the stock price. After the stock fell more than five-fold in the past year, Vodafone now offers a dividend yield of more than 8%. There are several others FTSE 100 The company’s offering is high yield – but not much.
With a strong brand, a large customer base and a strong demand for telecom services, I am hopeful that Vodafone will be a worthwhile investment for me.
Christopher Ruane owns shares in Vodafone.
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