Diversification is a subject most investors understand well. As the theory goes, it’s important to spread your bets so as to not become too heavily concentrated in one stock or industry. A critical piece of risk management is to not just try to maximize reward, but also minimize loss potential.
While most investors are likely diversified across asset classes, within their equity portfolios, they may not be diversified geographically. Picking companies from outside the United States is a great way to further diversify your stock investments. The following are some highly profitable companies that are headquartered in London that can provide a big boost to any portfolio.
Three great English companies
Within the consumer staples sector, investors have certainly come across the familiar American giants. Right alongside those industry stalwarts is Unilever plc (ADR) (NYSE:UL). What may be an unfamiliar name is actually a company with a slew of extremely familiar household brands.
Unilever plc (ADR) (NYSE:UL) has a long history stretching back more than a century, and a stable of popular brands including Dove, Vaseline, Bertolli, and Lipton. The company has a long operating history of more than 100 years, and along the way has amassed a market value nearing $120 billion.
Unilever plc (ADR) (NYSE:UL) recently delivered outstanding first-quarter results, particularly for a consumer staples company. Unilever plc (ADR) (NYSE:UL) generated nearly 5% underlying sales growth through the first three months on the strength of a 2.2% rise in volumes year over year. Pronounced strength was seen in the company’s hugely successful international segments. The company’s sales in emerging markets increased 10.4% through the first three months, as opposed to the same quarter one year ago.
In the wake of its first-quarter report, Unilever plc (ADR) (NYSE:UL) increased its dividend by 10% in euros per share. At recent prices, the stock yields 3.3% annualized.
Health care behemoth GlaxoSmithKline plc (ADR) (NYSE:GSK) is a great choice for investors interested in big pharma. GlaxoSmithKline plc (ADR) (NYSE:GSK) holds a $125 billion market value and its business is organized into Pharmaceuticals, Vaccines, and Consumer Health Care.
The past few years have been difficult for many pharmaceuticals, as the industry has grappled with slow global economic growth and patent expirations. Those problems are only exacerbated for companies operating in Europe, where the economic conditions remain challenged at best.