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The UK stock market has been out of date, but that adds up to good value FTSE 100.
There are several stocks that I would like to buy but I don't have any money left. It's one of the most frustrating aspects of investing fully.
Anyway, they are on my watch list and to me they seem to be rattling their cages and screaming to be bought! If the spare funds are available in October, I will put together some serious research and consider them seriously.
A protective gem
For example, I like the look of Coca-Cola HBC (LSE: CCH), the Swiss-based bottler of Coca-Cola products.
In August, the company presented a respectable set of half-year results and a positive outlook statement, despite challenging market conditions. I think Coca-Cola's brand strength serves the business well and gives it strong defensive credentials.
In other words, a business may be less affected by the ups and downs of the broader economy than many others.
However, the directors are not satisfied that the business is just treading water. They have a clear long-term growth agenda with a vision for the company to become “the best 24/7 beverage partner”.
The work is huge, serving around 740m consumers in 29 countries, and directors oversee the product portfolio. “is one of the most robust, comprehensive and flexible in the beverage industry.”
We are talking about products like Coca-Colaof course, but again Costa Coffee, He knows, Sprite, Schweppes, Kinley, The Gray Goose, Caffè Vergnano, Waltz, FuzeTea, Powerade, Cappy, Monster Power, Finnish Vodka, The Macallan again Jack Daniel's.
There are some strong names on that list, and that's one of the main reasons I'm bullish on the company as a potential long-term investment.
Trading well with growth ambitions
Meanwhile, at around 2,688p, the price has fallen slightly from its summer high.
However, City analysts expect good from the business. They expect average income to grow by about 5% this year and just over 10% by 2025.
As with all businesses, there are risks. One thing we've noticed in recent times with other similar companies is that their products have sometimes not been as protective as they were supposed to be. The latest business weakness for the beverage company Diageo one example.
Another risk is that the company may one day lose it Coca-Cola license to competitor. If that happens, it can be a disaster for the business.
However, the forward price-to-earnings ratio is around 13 by 2025 and the expected dividend yield is just over 3.4%. Those numbers are the same as the average for the entire FTSE 100, so I see the stock as offering fair value now.
But a fair price might be a good price for such a quality operator. I am aware of the approach of the great investor Warren Buffett when he prefers to buy great businesses at fair prices rather than such businesses at cheap prices.
Coca-Cola HBC is expected to release its third quarter earnings on October 29th and I will be watching with great interest.
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