4 global growth shares? HSBC Holdings plc, Diageo plc, Rolls-Royce Holding PLC and Banco Santander SA

Do these companies have improving financial outlooks? HSBC Holdings plc (LON:HSBA) (HSBA.L), Diageo plc (LON:DGE) (DGE.L), Rolls-Royce Holding PLC (LON:RR) (RR.L) and Banco Santander SA (LON:BNC) (BNC.L)




HSBC Holdings plc
HSBC Holdings plc

With Brexit causing a degree of uncertainty for UK shares, I’m considering the prospects for global stocks such as HSBC Holdings plc (LON:HSBA) (HSBA.L), Diageo plc (LON:DGE) (DGE.L), Rolls-Royce Holding PLC (LON:RR) (RR.L) and Banco Santander SA (LON:BNC) (BNC.L). Could they deliver improving financial outlooks?

HSBC’s decision to pivot to Asia could prove to be a sound move in my opinion. The company may be able to capitalise on the forecast growth rate in wages across parts of the region over future years.

Although there may be a slowdown in China at the moment, as recent economic data has highlighted, I’m optimistic about HSBC’s long-term prospects. With a dividend yield of around 6%, I think that the stock could offer a margin of safety.

Diageo’s financial prospects could improve over future years in my view, with the company’s efficiency strategy expected to lead to a stronger overall business. The recent disposal of a number of brands could mean that the business is better able to focus on areas where it has the greatest risk to reward opportunities.

Although Diageo has a relatively high valuation, I think that the stock could offer resilient growth over a long-term time horizon compared to some of its FTSE 100 peers.

Rolls-Royce’s financial prospects could improve in future years in my view. Increased defence spending by the US and other NATO members could stimulate demand for the company’s products. Similarly, a rising number of aircraft may mean that demand for its engines in the civil aerospace market increases.

With Rolls-Royce continuing to implement its efficiency strategy, I feel that the company may be able to generate improving financial performance after what has been an uncertain period.

Santander’s share price could be impacted by Brexit, as well as political risk in other key markets such as Brazil. However, with it having a diverse business model, I feel that it may be able to deliver improving EPS growth, as per its forecasts over the next couple of years.

With a single-digit P/E ratio and what seems to be a sound overall strategy, I believe that Santander may offer recovery potential in future years. However, further share price volatility cannot be ruled out in the short run.




About Robert Stephens 5430 Articles
Robert Stephens is a CFA Charterholder and an Equity Analyst by trade. He is a passionate private investor who has been buying and selling shares for many years, owning a wide range of UK shares in the process. He has written for Citywire and The Motley Fool US and now runs his own business. To contact Robert, please email info@investomania.co.uk or use one of the other contact methods available on the 'Contact Us' page