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Two shares of stock that I plan to buy when I have the money to invest Coca-Cola HBC (LSE: CCH) and Assura (LSE: AGR).
Here is the reason!
Bottled fizz
You'd be forgiven for thinking that Coca-Cola HBC is actually the main one Coca-Cola business, isn't it. Nevertheless, it still plays an important role in the beverage powerhouse as one of its major bottlers for many of its favorite brands around the world.
Starting with Coca-Cola HBC's valuation, shares trade at an earnings multiple of 14. This is much lower than the main business, which trades at a ratio of more than 22. Getting the product power and accessibility of Coca-Cola through one of our partners at a cheaper price is attractive.
In addition, the shares offer a dividend yield of 3%. This may not sound very high, but the company's profit growth record in recent years is very good. If this trend continues, the pay rate could be very good in the coming years. However, I understand that benefits are not guaranteed. Also, the past is no guarantee of the future.
From a bearish perspective, a few issues worry me. The first problem is the economic turmoil that could affect incomes as consumers struggle with the high cost of living. This can push people away from premium brands like Coke. Another is the increase in popularity of weight loss medicine GP-1which can curb cravings for sugary drinks. This may impact performance and returns. I will look into this.
Overall, Coca-Cola HBC has access to the full potential of Coca-Cola brand, including its large presence and enduring popularity. Buying stocks can be a great way to help me build wealth.
Health care facilities
Assura is established as a real estate investment trust (REIT). This means that it makes money from the asset, and must return 90% of its profits to shareholders. Assura specializes in healthcare products such as GP surgeries and other healthcare related services.
Please note that tax treatment depends on the individual circumstances of each client and may change in the future. The content of this article is provided for informational purposes only. It is not intended to be, and does not constitute, any form of tax advice.
The structure of the business policy and returns is an attractive opportunity to help build wealth. However, the shares look very good value for money right now at a price-to-book ratio of 0.85, which is good.
In addition, there is a defensive aspect to the business that makes the shares very attractive to me. Health care is important to everyone, regardless of economic status. Also, as the UK population ages and grows, the demand for healthcare is bound to increase. This gives Assura an opportunity to increase profits and gains.
Finally, from a return perspective, a dividend yield of close to 8% is attractive. For context, the FTSE 100 average is 3.6%.
From a bearish perspective, economic turmoil in the context of high interest rates and inflation could be a major risk for Assura. Higher values mean lower net asset values (NAVs). Also, debt is more expensive to acquire to grow, and existing debt can be more expensive to service. Debt is key for REITs to fund growth. I will look into this.
Overall, Assura shares look great value for money, offer a good payout ratio, and operate in a defensive sector. What don't you like?
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