Buy German Stocks After World Cup Title

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In the wake of a scintillating, extra-time 1-0 victory over superstar-laden Argentina, the German national soccer team emerged as World Cup champions this past weekend. After playing to a draw in the first ninety-minutes of the historic matchup, Germany's young star Mario Gotze broke the deadlock with a dazzling goal in the 112th minute. The moment of brilliance lifted Germany to its fourth World Cup title, which is the second-most behind Brazil's five tournament victories. The performance of the German national team certainly captivated the world throughout the World Cup and filled the country's citizens with pride. Although the United States squad came up short in their bid for the trophy, falling to a talented Belgian team in the round of 16, all is not lost - at least for U.S. based investors looking to capitalize on the soccer spectacle which only comes around every four years. In fact, there is actually a historical correlation between the winner of the World Cup and stock prices. Analysts from Goldman Sachs have calculated that the winning country's stock market outperforms the global average by around 3.5 percent in the month following the tournament. This is a very sizable margin for such a short time period. Pretty interesting, right? Naturally, the next question is what German stocks trade on American exchanges (there aren't many) and can easily be bought and sold through any broker? Below, Benzinga provides the answer to this question and delves into more detail on three German companies that are publicly traded in the United States. Although we may not be the best footballers in the world, the U.S. does have the largest, most efficient capital markets on the planet.
Fresenius Medical Care AGFMS
- This German healthcare facilities and services company trades on the New York Stock Exchange as an ADR. Fresenius is a $21 billion firm headquartered in the town of Bad Homburg, Germany. The company employs nearly 92,000 people across its three business segments - North America, International and Asia Pacific. Fresenius is engaged in the fields of dialysis care and sells dialysis products for the treatment of end-stage renal disease. Over the long-term, the stock has been a steady and strong performer, rising around 171 percent over the last 10-years and roughly 52 percent on the five-year chart. Over the last several years, however, the stock has been locked in a range between $31.00 and $39.00 and is currently sitting near the bottom quartile of that trading band. Nevertheless, Fresenius has been able to grow its top-line sales in each of the last five years and recorded an impressive $14.1 billion in revenue in its most recent fiscal year. If the German stock market does indeed outperform over the next month, this should be a name to watch.
SAPSAP
- This German enterprise-software behemoth is one of the most powerful technology firms on Earth and trades on the New York Stock Exchange as an ADR. Currently, SAP has a market-cap north of $93 billion and employs almost 67,000 people spread across a host of business segments. The divisions include Applications, Analytics, Mobile, Database and Technology, Cloud, and Professional Services. Overall, the stock has been a long-term winner, rising almost 100 percent over the last decade, but has been languishing in 2014 with the shares shedding more than 10 percent. In addition, the stock is currently yielding around 1.30 percent. The scope of SAP's operations is seen in its nearly $17 billion in sales for fiscal 2013. Given that it operates in the lucrative enterprise software space, the company also has terrific margins and other financial metrics. For example, in its most recent fiscal year, SAP recorded an enviable profit margin of almost 20 percent and a return on equity of over 22 percent. Looking ahead, Wall Street analysts are projecting sales growth of just under 4 percent for fiscal 2014, followed by a 7 percent jump in revenue in the following year. Overall, this is a very solid, safe stock that may offer investors capital appreciation along with its respectable dividend yield.
Deutsche BankDB
- The Germans are well-known for their banking sector. The leading German financial institution is Deutsche Bank which competes with Wall Street heavyweights such as
Morgan StanleyMS
,
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Goldman SachsGS
, and
J.P. MorganJPM
on a global basis. The stock, like the others on this list, trades on the New York Stock Exchange as an ADR. Like its counterparts, Deutsche Bank has experienced some significant ups and downs in the years since the financial crisis. In the Spring of 2007, Deutsche Bank put in a new all-time high of around $160. By the Fall of 2008, however, the stock had sunk as low as $25. Unfortunately, for the German bank, the share price has failed to rebound unlike some of its Wall Street competitors. Over the last year, the stock has tanked roughly 17 percent, including a substantial 25 percent loss so far in 2014. Despite this poor performance, investors do receive a better than 2 percent dividend yield at current levels. Furthermore,the Frankfurt, Germany-based firm remains a major player in global investment banking, employing more than 97,000 and sporting a market-cap of just under $40 billion.
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Posted In: Long IdeasNewsShort IdeasDividendsEventsGlobalTop StoriesHotTrading IdeasargentinaGermanyMario GotzeWorld Cup
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