In times of high volatility, large corporations with a significant market position often present good entry opportunities for investors, especially when they are undervalued during weak phases. These companies often have the potential for a long-term price correction and provide security through their stable cash flows and market positions. Here are three strong market leaders that are currently considered undervalued and exhibit recovery potential:
Nike
- Market Position: Nike is a leading company in the sports equipment market and enjoys a strong brand identity.
- Recovery Potential: Since the end of 2021, Nike has lost more than 64% of its value, indicating a market overreaction and offering comeback potential.
- Dividend: Nike regularly pays dividends, which is attractive for long-term investors.
Barry Callebaut
- Market Position: Barry Callebaut is the world’s largest chocolate manufacturer and benefits from its strong market position in the food sector.
- Recovery Potential: Despite current challenges in the food market, Barry Callebaut offers long-term stability and growth potential.
- Dividend: Barry Callebaut offers a stable dividend yield, which is appealing for income-focused investors.
Eurofins
- Market Position: Eurofins is a leading company in food and environmental analysis and enjoys a strong market position in the industry.
- Recovery Potential: Despite short-term fluctuations, Eurofins offers strong long-term growth potential as the demand for analysis and testing services continues to rise.
- Dividend: Eurofins offers an attractive dividend yield, which is interesting for investors seeking regular income.
These companies not only offer the potential for a long-term price correction but also a stable dividend yield, which can be as high as 3.44%. Investors who focus on value investing could benefit from these opportunities, as the prices of these companies often tend to return to their intrinsic value over the long term.
Further Considerations
- Market Volatility: In times of high volatility, it is important to invest in companies with strong competitive advantages, as they tend to weather crises better.
- Long-term Strategy: Investors should focus on a long-term perspective, as short-term fluctuations are often caused by market overreactions.
- Diversification: A diversified investment strategy can help minimize risks and benefit from various market segments.
In addition to these three companies, there are also others recovering from a crisis, such as Siemens Energy, which has made an impressive comeback story in the DAX. After it has redeemed its state guarantees, the company could soon resume paying dividends, making it an interesting option for investors.