Cash in on the growth prospects of Europe's companies
Marcel Stötzel, co-portfolio manager of the Fidelity European Trust, selects three stocks


The Fidelity European Trust takes a cautious approach to risk and aims to achieve consistent long-term outperformance driven by stock selection. The strategy focuses on identifying companies capable of sustainable dividend growth over a period of between three and five years. We look for four main characteristics in businesses: positive fundamentals; the ability to generate cash; a strong balance sheet; and an attractive valuation.
We also seek balance across sectors, believing that stock selection should be the primary driver of performance. By focusing on quality businesses, the strategy tends to outperform in weaker markets, providing a defensive edge. Additionally, our long-term view aims to improve performance and reduce transaction costs.
Europe’s best airline poised for take-off
We see an attractive opportunity in no-frills airline Ryanair (Dublin: RYA). It is one of the lowest-cost providers in a commoditised industry, with a laser focus on keeping costs down and solid cash generation. Although it is operating in a challenging sector, the company is distinguished by its management team, which is the best in the sector. Moreover, it is attractively valued, owns its aeroplanes, and has the highest route density in Europe.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
With an improved balance sheet and a normalised market environment, we see strong potential for sustainable capital returns. The company can also benefit from higher-than-expected fare increases, given curtailed supply of new aircraft and grounding of competitors’ aeroplanes. The combination of these factors creates a compelling structural story.
TotalEnergies (Paris: TTE) is a multi-energy company that produces and markets fuels, natural gas, and electricity. It is one of the few examples of a business in a cyclical industry that maintains a steady dividend payout despite volatile earnings. The company stands out as a superior long-term capital allocator, supported by a prudent and well-executed management strategy.
The group’s upstream portfolio remains robust, featuring high-quality projects. TotalEnergies also prioritises shareholders’ interests and demonstrates strong forward planning. It has refocused on more renewable energy sources, including solar, wind, biomass, hydrogen and electricity, as well as the traditional natural gas and oil business. TotalEnergies’ long history of dividend growth bolsters our confidence, making it one of our top positions in the trust.
A stock to play AI
What excites us most as we look ahead to 2025 is witnessing the transformative impact of the broader adoption of AI. A standout stock in this field is the French electrical company Legrand (Paris: LR), a key holding in our trust. While many investors focus on well-known US leaders in the field of artificial intelligence, we see Legrand as a more subtle way to capitalise on the AI trend.
The company provides much of the “white space” equipment for datacentres (power distribution units, switches, transformers) and this part of the business is growing strongly. In addition, the rest of Legrand’s business (focused on residential and non-residential construction) is well positioned to benefit as these markets recover from cyclical lows.
This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.
Sign up for MoneyWeek's newsletters
Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.
Marcel Stotzel joined Fidelity as an analyst in 2014. He initially covered US tech as an MBA intern, before being hired full-time to cover European Software and IT services and thereafter European Aerospace, Defence and Airlines.
After a highly rated period in research, Marcel was promoted to Portfolio Manager and he has co-managed the Fidelity European Fund and Fidelity European Trust PLC since August 2020.
Prior to joining Fidelity, Marcel worked as an investment banker at Barclays. Marcel holds an MBA (INSEAD), is a CFA charter holder and graduated with a Business Science (Hons) in Finance from the University of Cape Town.
-
Lloyds axes foreign currency fees for Club Lloyds customers
Club Lloyds customers will be able to withdraw their money abroad without incurring any extra fees
By Daniel Hilton Published
-
How to invest during stagflation
Trump’s tariffs look poised to push the global economy into a period of stagflation. We look at how to ensure your investments can survive a global slowdown.
By Dan McEvoy Published
-
The star small and mid-cap stocks income investors have overlooked
Opinion Thomas Moore, senior investment director, Aberdeen, highlights three company stocks as he shares where he would put his money
By Thomas Moore Published
-
Falling revenues and mounting debt spell trouble for Jumia Technologies
Struggling African e-commerce platform Jumia Technologies looks headed for the exit, says Dr Matthew Partridge.
By Dr Matthew Partridge Published
-
Chemring Group: an explosive investment opportunity in defence
European states are raising their military spending, and Chemring Group looks well placed to profit
By Rupert Hargreaves Published
-
Best of British bargains: cash in on undervalued companies in the UK stock market
Opinion Michael Field, Chief Equity Market Strategist, EMEA, Morningstar, selects three attractive UK stocks where he'd put his money
By Michael Field Published
-
PZ Cussons share price down 75% in last decade – why it's one to watch
Opinion Once-strong consumer-goods business PZ Cussons is out of favour with the market. That spells opportunity for investors, says Jamie Ward
By Jamie Ward Published
-
Cash in on the biotech sector with specialist trust BioPharma
Opinion BioPharma has an attractive niche in lending to asset-rich biotechnology companies
By Rupert Hargreaves Published
-
Three top-notch Taiwanese companies cashing in on the advent of AI
Opinion Eric Chan, investment director and co-manager of the Aberdeen Asian Income Fund, highlights three potential Taiwanese winners in the technology industry
By Eric Chan Published
-
Find tomorrow’s Asian giants while they are still smaller companies
Opinion Nitin Bajaj, portfolio manager of the Fidelity Asian Values trust, picks three Asian companies to invest in.
By Nitin Bajaj Published