Société BIC a 'forgotten' value stock!
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There is a famous saying among portfolio managers ''The best stocks to invest in while the economy is plunged in a recession tend to be boring, get-the-job-done companies.''
Anyone knows that when the economy declines, many investors begin to load their portfolios with defensive stocks or stock funds from defensive sectors.
These funds are referred to as "defensive" because they tend to maintain their earnings and revenues during market downturns, allowing them to perform better than the broader market during a market correction or a bear market accompanied by a recession. Understanding defensive stock funds and knowing how to add them to your portfolio can help preserve your returns in hard times.
Unlike cyclical sectors like financial services, which are highly dependent on the economic cycle, defensive or non-cyclical sectors like health care tend to generate stable profits throughout all phases of the economic cycle.However, you can find defensive stocks in any sector as far as the firm has strong earnings, innovation, pricing power, and a track record of disrupting the status quo.
The basic idea of investing in defensive stock funds is to protect (defend) against significant decreases in share prices that are happening during either corrections of the market, meaning market declines of between 10% and 20%, or bear markets,such as declines of 20% or more, and potentially, an upcoming recession.
During hard times, consumers typically reduce spending on luxury items and buy only essentials, including food, health care, and basic utilities. If you buy defensive stocks in industries like these, your holdings should, in theory, decline less dramatically since these stocks should be less volatile in price during a decline.
One of the misconceptions that you get teached in almost any Master in economics, is that investors or traders act rationally.One huge proof of denying this is the stock of Société BIC.
Société BIC SA manufactures and sells stationery, lighter, shaver, and other products in Europe, Cello®, Conté®, BIC FlexTM, Lucky Stationery, Made For YOUTM, Soleil®, Tipp-Ex®, Wite-Out® and more, and internationally.
Sales Breakdown by product:
- Stationery (39.7%): ballpoint pens, pencils, mechanical pencils, felt-tip pens, correction pens, erasers, permanent markers, glues, adhesive notepads, etc.;
- Lighters (34.8%)
- Razors (23.7%)
- Other (1.7%): mainly sport articles (windsurfing boards, surf boards, etc.), batteries, magnets, adhesives, etc.
Geographical Allocation: Europe (28.7%), North America (39.2%) and other (32.1%).
Fundamental analysis: According to DCF valuation model Société BIC stock is currently undervalued by 37%.BIC's dividend yield is 5,6% at these price levels with a payout ratio of 68%.This ratio is more than enough to guarantee the continuation of the dividends,at the same time huge companies have already reduced or suspended their dividends.Overall BIC has flawless balance sheet,it's undervalued and pays a dividend.
Technical Analysis: We are currently at the bottom of a weekly downward channel with a double bottom pattern and an bullish RSI divergence.
Selling volume also significantly reduced and possible doji candlestick formation at the monthly chart!
Possible Long Trade :
Entry at 40-43 area.
Stop Loss under 40-39.50 area.
TP at 55-57 area.Risk/Reward: 4.5
Weekly double bottom with bullish Divergence
RISK DISCLAIMER:
My Recommendations/suggestion/advice for stocks/commodities are based on the theory of technical/fundamental analysis and personal observations. This does not claim for sure/ certain profit or any fix returns. I am not responsible for any losses made by traders. It is only the general view of the market with reference to its previous/prior performance. You are advised to take your position with your sense, discretion and judgment.
I try mymaximum to consider the fundamental validity of stocks or commodities as far as possible, but demand and supply affect the market with vision variations. If any other company also giving same script/stock and advice/suggestion then i am not responsible/liable for that.I have not any position in our given scripts or stocks.
The guidelines given here will have to be handled as simplest/ easy to understand / straightforward factor, whereas making a funding decision. This article does no longer present personally tailor-made investment recommendation/suggestion/advice.I recommend that investors should independently review particular investments/trades and techniques.I shall not be accountable/liable or responsible for any transaction performed in response to the guidelines given in this report, which is in violation of rules and regulations.
Note:-
I really Respect/value Your Hard Earned wealth/asset/money etc it’s very important for the human being, losing the same creates a lot of pain or feeling regret. Hence you are strongly advised to Always trade safely, follow guidelines and trading rules without missing a single time.
Thank you for your time and support,Happy to help anytime
The Greek Trader
Anyone knows that when the economy declines, many investors begin to load their portfolios with defensive stocks or stock funds from defensive sectors.
These funds are referred to as "defensive" because they tend to maintain their earnings and revenues during market downturns, allowing them to perform better than the broader market during a market correction or a bear market accompanied by a recession. Understanding defensive stock funds and knowing how to add them to your portfolio can help preserve your returns in hard times.
Unlike cyclical sectors like financial services, which are highly dependent on the economic cycle, defensive or non-cyclical sectors like health care tend to generate stable profits throughout all phases of the economic cycle.However, you can find defensive stocks in any sector as far as the firm has strong earnings, innovation, pricing power, and a track record of disrupting the status quo.
The basic idea of investing in defensive stock funds is to protect (defend) against significant decreases in share prices that are happening during either corrections of the market, meaning market declines of between 10% and 20%, or bear markets,such as declines of 20% or more, and potentially, an upcoming recession.
During hard times, consumers typically reduce spending on luxury items and buy only essentials, including food, health care, and basic utilities. If you buy defensive stocks in industries like these, your holdings should, in theory, decline less dramatically since these stocks should be less volatile in price during a decline.
One of the misconceptions that you get teached in almost any Master in economics, is that investors or traders act rationally.One huge proof of denying this is the stock of Société BIC.
Société BIC SA manufactures and sells stationery, lighter, shaver, and other products in Europe, Cello®, Conté®, BIC FlexTM, Lucky Stationery, Made For YOUTM, Soleil®, Tipp-Ex®, Wite-Out® and more, and internationally.
Sales Breakdown by product:
- Stationery (39.7%): ballpoint pens, pencils, mechanical pencils, felt-tip pens, correction pens, erasers, permanent markers, glues, adhesive notepads, etc.;
- Lighters (34.8%)
- Razors (23.7%)
- Other (1.7%): mainly sport articles (windsurfing boards, surf boards, etc.), batteries, magnets, adhesives, etc.
Geographical Allocation: Europe (28.7%), North America (39.2%) and other (32.1%).
Fundamental analysis: According to DCF valuation model Société BIC stock is currently undervalued by 37%.BIC's dividend yield is 5,6% at these price levels with a payout ratio of 68%.This ratio is more than enough to guarantee the continuation of the dividends,at the same time huge companies have already reduced or suspended their dividends.Overall BIC has flawless balance sheet,it's undervalued and pays a dividend.
Technical Analysis: We are currently at the bottom of a weekly downward channel with a double bottom pattern and an bullish RSI divergence.
Selling volume also significantly reduced and possible doji candlestick formation at the monthly chart!
Possible Long Trade :
Entry at 40-43 area.
Stop Loss under 40-39.50 area.
TP at 55-57 area.Risk/Reward: 4.5
Weekly double bottom with bullish Divergence
RISK DISCLAIMER:
My Recommendations/suggestion/advice for stocks/commodities are based on the theory of technical/fundamental analysis and personal observations. This does not claim for sure/ certain profit or any fix returns. I am not responsible for any losses made by traders. It is only the general view of the market with reference to its previous/prior performance. You are advised to take your position with your sense, discretion and judgment.
I try mymaximum to consider the fundamental validity of stocks or commodities as far as possible, but demand and supply affect the market with vision variations. If any other company also giving same script/stock and advice/suggestion then i am not responsible/liable for that.I have not any position in our given scripts or stocks.
The guidelines given here will have to be handled as simplest/ easy to understand / straightforward factor, whereas making a funding decision. This article does no longer present personally tailor-made investment recommendation/suggestion/advice.I recommend that investors should independently review particular investments/trades and techniques.I shall not be accountable/liable or responsible for any transaction performed in response to the guidelines given in this report, which is in violation of rules and regulations.
Note:-
I really Respect/value Your Hard Earned wealth/asset/money etc it’s very important for the human being, losing the same creates a lot of pain or feeling regret. Hence you are strongly advised to Always trade safely, follow guidelines and trading rules without missing a single time.
Thank you for your time and support,Happy to help anytime
The Greek Trader
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Amazing trade bringing us 30% and more in profit!Stay in your plan guys and girls!
Second TP at 62$ reached!!
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