The Invesco European Growth Fund (Trades, Portfolio), part of Georgia-based investment management firm Invesco Ltd., disclosed its fourth-quarter portfolio this week, listing four new positions.
With the objective of long-term growth of capital, fund managers Clas G. Olsson, Jason T. Holzer, Matthew Dennis, Borge Endresen and Richard Nield invest in reasonably priced, quality European companies, focusing on strong fundamentals and sustainable earnings growth.
The fund’s portfolio of 61 holdings is largely composed of securities in the financial services sector, which has a portfolio weight of 30.4%.
According to GuruFocus, the fund underperformed the S&P 500 in 2016 with a return of -2.75%.
The fund’s new positions are Standard Life Aberdeen PLC (LSE:SLA, Financial), ING Groep NV (XAMS:INGA, Financial), Bic (XPAR:BB, Financial) and Vinci SA (XPAR:DG, Financial).
Standard Life Aberdeen
The fund’s largest new purchase for the quarter was 4.4 million shares of Standard Life Aberdeen, which is a newly combined company. Aberdeen Asset Management PLC and Standard Life PLC completed the merger in August. The fund paid an average price of 4.3 pounds ($5.82) per share, giving the position 1.71% portfolio space.
The U.K.-based investment company has a market cap of 12.96 billion pounds; its shares were trading around 4.35 pounds on Tuesday with a price-earnings (P/E) ratio of 19.79, a price-book (P/B) ratio of 1.96 and a price-sales (P/S) ratio of 0.46.
The Peter Lynch chart below shows the stock is trading above its fair value, which suggests it is currently overpriced.
GuruFocus ranked Standard Life’s financial strength 7 of 10 and its profitability and growth 4 of 10. The company’s trailing dividend yield and forward dividend yield are both 4.68%. The dividend payout ratio is 90%.
The Oakmark International Small Cap Fund is the company’s largest guru shareholder with 0.27% of outstanding shares.
ING Groep
The fund invested in 702,142 shares of ING Groep for 15.39 euros ($18.45) per share, expanding the portfolio 0.88%.
The Dutch bank has a market cap of 62.02 billion euros; its shares were trading around 15.96 euros on Tuesday with a P/E ratio of 12.57, a P/B ratio of 1.25 and a P/S ratio of 3.46.
According to the Peter Lynch chart below, the stock is trading close to its fair value.
GuruFocus ranked ING’s financial strength 4 of 10 and its profitability and growth 4 of 10. The bank’s trailing dividend yield and forward dividend yield are both 4.14%. The payout ratio is 52%.
With 0.06% of outstanding shares, the Causeway International Value (Trades, Portfolio) Fund has the largest holding among the gurus.
Bic
The fund bought a 116,907-share position in Bic for an average price of 97.86 euros per share. The trade had an impact of 0.84% on the portfolio.
The French manufacturer of stationary products, lighters and razors has a market cap of 4.24 billion euros; its shares were trading around 95 euros on Tuesday with a P/E ratio of 18.75, a P/B ratio of 2.59 and a P/S ratio of 2.22.
Due to a lack of historical financial data, GuruFocus is unable determine the stock’s value using Peter Lynch’s methods. GuruFocus, however, does give Bic strong financial strength and profitability and growth ratings, both of which are 8 out of 10.
The company’s trailing dividend yield and forward dividend yield are both 3.63%. The payout ratio is 59%.
The European Growth Fund holds 0.26% of Bic’s outstanding shares.
Vinci
The fund’s smallest new purchase for the quarter was 24,209 shares of Vinci. It paid an average price of 79.09 euros per share, giving the holding 0.16% portfolio space.
The French construction company has a market cap of 49.14 billion euros; its shares were trading around 88.56 euros on Tuesday with a P/E ratio of 18.94, a P/B ratio of 3.01 and a P/S ratio of 1.29.
Based on the Peter Lynch chart below, the stock appears to be overpriced as it is trading above its fair value.
GuruFocus ranked Vinci’s financial strength 5 of 10 and its profitability and growth 5 of 10. The company’s trailing dividend yield and forward dividend yield are both 2.44%. The payout ratio is 45%.
Bernard Horn (Trades, Portfolio) is the company’s largest guru shareholder with 0.01% of outstanding shares.
Disclosure: I do not own any stocks mentioned.
