You are here: Home - Investing - Experienced Investor - News -

Stock of the week: Reckitt Benckiser

Written by:
Helal Miah, investment research analyst at The Share Centre, picks Reckitt Benckiser as stock of the week.

Reckitt Benckiser, best known for its household brands such as Nurofen, Cillit Bang and Vanish, is in advanced talks to buy baby food maker Mead Johnson for $16.7 bn. Following the announcement, Reckitt Benckiser’s shares jumped 3.7%. Investors will be interested to know that this acquisition will move the company into a new market, which Mead Johnson is a big player in.

The firm has a strategy of increasing exposure to emerging markets, which is already bearing fruit.  Following the launch of a £100m marketing drive, Reckitt Benckiser reached its target of generating 50% of revenues from emerging markets. Investors should appreciate that the group plans to concentrate increasing its market exposure in 16 countries throughout a five year plan.

We have long been fans of the company for the lower risk investor, despite its high rating and comparatively low yield. The group has been an excellent and consistent performer over the last 16 years although it has been criticised for not having enough exposure to emerging markets. Management have taken this on board and now the drive into the higher growth regions is paying dividends. They are also expanding and focussing on the health and hygiene businesses where margins are higher. We therefore recommend this stock as a ‘Buy’.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
Redundancy and boredom push over 50s to change career

Three quarters of UK employees are ‘re-inventing themselves’ in later life and embarking on a new career, research suggests.