How is the stock market doing in the summer? Trends.be polls equity market observers weekly about their preferred securities.
This week it is the turn of Martine Hafkamp, the founder, owner and general manager of Fintessa Asset Management in Baarn, the Netherlands. As an asset manager and stock market analyst, the Dutch can be heard and seen at, among others BNR in Business Class.
1/ Nvidia
“The demand for chips seems to be on the decline, but that does not apply to semiconductors for data centers and artificial intelligence. These are mainly made by the world’s largest chip maker: Nvidia. Business is going much better than expected and turnover expectations have increased considerably. Nvidia mainly benefits from a high demand for artificial intelligence chips. Nvidia therefore shows that artificial intelligence is not a hype. The fact that Nvidia has signed an agreement with Microsoft to allow games on Nvidia’s gaming platform is a boost. Analysts also expect demand for automotive chips to continue to grow.”
2/ Equinor
“Equinor has a joint venture with the German utility company RWE to jointly build power stations in Germany. They will initially run on Norwegian gas. The new power stations are intended to replace coal-fired power stations. As soon as that is possible, the gas will be replaced by hydrogen, which is produced sustainably. To this end, Equinor and RWE will jointly build a new wind farm off the Norwegian coast. Some of these will be taken into use in 2030. Equinor also continues to invest in fossil energy. For example, it was awarded 26 new production licenses for oil and gas fields in the North Sea, the Norwegian Sea and the Barents Sea. In addition, the company is buying back its own shares for USD 6 billion and paying out a very attractive dividend with a total yield of around 10 percent.”
3/ Wolters Kluwer
“Wolters Kluwer is not affected by inflation or higher interest rates. It is an information provider for physicians, accountants, lawyers and tax, finance, risk management, compliance and regulatory professionals. No less than 81 percent of turnover is of a recurring nature thanks to subscriptions. Many professionals need information from Wolters Kluwer, regardless of price. The stock has been an outperformer on the stock market for the past ten years with an average return of 24.3 percent, including reinvested dividends. The price of the share is correspondingly. But the strong balance sheet, steady revenue and profit growth and defensive nature make the stock a good investment in these uncertain times.”
4/ Adobe
“The healthy Adobe is one of the best investments in Software as a Service (SaaS). A very promising division of Adobe is Digital Experience, which helps customers improve their marketing performance with the help of artificial intelligence or AI. Artificial intelligence is currently a hype. Any company that engages in this will receive more than normal interest from investors. The division generates about 26 percent of Adobe’s revenue and is growing rapidly. Adobe is busy adding artificial intelligence to its entire product portfolio.
The acquisition of Figma, if approved, will be paid for through a combination of cash and the issuance of new shares. If all cash is used, the debt will be only 0.4 times the expected EBITDA for fiscal year 2024. In addition, Adobe has free cash flow of about $7.5 billion per year, which means that the acquisition will be completed in just under three years will be.”
5/ Microsoft
“With the investment in Open AI and the bot ChatGPT, Microsoft has entered a new, very fast growing market. Microsft is integrating the AI technology across its entire product line, enabling it to attract additional clients and charge higher prices. Partly due to artificial intelligence, the profitable cloud business continues to grow strongly. Thanks to ChatGPT, the search engine Bing also seems to be becoming more attractive again. Not only does Microsoft have a partnership with OpenAI, which allows it to implement artificial intelligence in its own products, if other companies want to use OpenAI’s software, it must be hosted in the cloud at Microsoft. It is also, for example, the cloud host of Llama 2 from Meta, which runs on Windows.”
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2023-07-30 05:52:21
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