The United States has the high-flying Magnificent Seven. UBS has compiled an equivalent list of 18 outperformers for Europe.
Perhaps the hottest names in the European group are pharmaceutical company Novo Nordisk and chipmaking equipment supplier ASML.
,
whose shares have both hit record highs this year. Novo’s role in the weight-loss drug craze helped the stock, while ASML’s focus on the artificial intelligence chip supply chain boosted shares. Both have American markings.
While Novo and ASML could fit into the Mag Seven technology group, the rest of the UBS roster is very different from the US group.
It is largely filled with a mix of luxury stocks such as LVMH.
,
Hermes
,
and Christian Dior; consumer goods suppliers Unilever
,
Diageo
,
Nestle
,
and L’Oreal; and pharmaceutical companies AstraZeneca
,
rock
,
Novartis
,
and Sanofi
.
The other members are the international bank HSBC
,
SAP accounting software provider
,
industrial company Siemens
,
energy company TotalEnergies
,
and Dutch consumer internet investment company Prosus
.
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Mag 18 represents a total of 25% of the total market capitalization of the
Stoxx Europe 600 Index,
corresponding to the original weighting of the Mag Seven compared to the
S&P500.
“Returns for this group of stocks have been comparable to those of the US Magnificent Seven from 2021 to present, with Europe outperforming in 2022 when the US saw significant declines,” wrote analyst Sutanya Chedda at UBS, in a research note.
Consensus estimates this group of stocks will generate around 12% total return over the next 12 months, compared to the roughly 14% return expected for Mag 7, according to UBS.
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Write to Adam Clark at [email protected]
