The ability to navigate unpredictable environments while at the same time preparing for what the future holds is of paramount importance if a business is to be successful. Among the many opportunities that European equities offer investors, there are specific characteristics that we believe will determine the success of a business model, such as profitability and reinvestments for growth.
We exclude companies that do not adhere to principles consistent with sustainable and responsible investment, which helps us discover businesses that have the long term in mind. Moreover, there are attractive themes for investors to take into consideration at present, such as what we call the “renewables megatrend”.
Orsted: a tailwind from Denmark
Denmark’s Orsted (Copenhagen: ORSTED) is a leading provider of renewable energy, especially offshore wind. Support for renewable energy is expanding rapidly, not least because if we are to meet the Paris Agreement target for reducing the pace of the increase in global warming, we will need to have cleaner sources of energy, moving away from fossil fuels, with electricity growing its share of final demand.
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
Wind and solar energy will therefore continue to be in the spotlight. Even during the Covid-19 pandemic, when demand for electricity fell by a fifth in the first quarter of 2020, the output from renewables was largely unaffected.
The International Renewable Energy Agency (IRENA), forecasts that renewables’ share of electricity in final energy consumption will increase from just 20% today to almost 50% by 2050. Additionally, renewable technologies are becoming increasingly efficient, driving down the average cost of the electricity they produce.
Schneider Electric: leading the energy-efficiency drive
Schneider Electric (Paris: SU) develops products and software that provide buildings with significant energy efficiency and sustainability benefits. It is the market leader in this type of offering. The company is also exposed to favourable long-term trends, such as electrification and digitisation.
Schneider has a wide range of offerings, from light switches and electrical sockets to software for energy management and industrial automation, but also scores well when it comes to protecting the environment. For example, the company is committed to sustainability within its own operations, with carbon-neutrality goals such as net-zero operational emissions by 2030 and a net-zero supply chain by 2050.
Sanofi : the turnaround story in French pharma
Sanofi (Paris: SAN) is a turnaround story based on new managers’ vision of the future. After years of underperformance compared with its peers, the company has significantly reduced the risk inherent in its diverse portfolio, with no major patent expirations before 2023.
Despite the crisis, the business remains largely undisrupted, with studies ongoing, 100% of manufacturing and supply sites operational, and no product shortages. By virtue of the nature of its business we believe it makes a positive contribution to society while also being committed to improving access to healthcare.
-
How to pay in a chequeReceiving or writing a cheque has become much less common in recent years as instant bank transfers have grown in popularity. Amid widespread bank branch closures, we explain what to do if you get a cheque, and how you can pay one into your bank account.
-
Crypto assets of seven million UK investors at risk – how to keep yours safeCryptocurrency wallet rules make it hard to track down assets after someone has died, even if they leave a will saying who they would like to inherit them
-
8 of the best properties for sale with kitchen gardensThe best properties for sale with kitchen gardens – from a 17th-century timber-framed hall house in Norfolk, to an Arts & Crafts house in West Sussex designed by Charles Voysey with a garden by Gertrude Jekyll
-
Why investors can no longer trust traditional statistical indicatorsOpinion The statistical indicators and data investors have relied on for decades are no longer fit for purpose. It's time to move on, says Helen Thomas
-
Investors rediscover the virtue of value investing over growthGrowth investing, betting on rapidly expanding companies, has proved successful since 2008. But now the other main investment style seems to be coming back into fashion.
-
8 of the best properties for sale with shooting estatesThe best properties for sale with shooting estates – from an estate in a designated Dark Sky area in Ayrshire, Scotland, to a hunting estate in Tuscany with a wild boar, mouflon, deer and hare shoot
-
The most likely outcome of the AI boom is a big fallOpinion Like the dotcom boom of the late 1990s, AI is not paying off – despite huge investments being made in the hope of creating AI-based wealth
-
What we can learn from Britain’s "Dashing Dozen" stocksStocks that consistently outperform the market are clearly doing something right. What can we learn from the UK's top performers and which ones are still buys?
-
The rise of Robin Zeng: China’s billionaire battery kingRobin Zeng, a pioneer in EV batteries, is vying with Li Ka-shing for the title of Hong Kong’s richest person. He is typical of a new kind of tycoon in China
-
Europe’s forgotten equities offer value, growth and strong cash flowsOpinion Jonathon Regis, co-portfolio manager, Developed Markets UCITS Strategy, Lansdowne Partners, highlights forgotten equities he'd put his money in
