--> AB Inbev, Essity, Novartis, Orange, ABN, Generali, ABB, H&M & Atos
Since the launch of this product four years ago, our approach has been to identify high-conviction bottom-up ideas that best fit our strategy framework. With the help of our seven local heads of research and our sector heads, we have surveyed our 105 analysts and publish seven Country Top Picks and two European Selected Lists (Large and SMID caps).
Since its launch, our Large Caps Selected List has delivered a 33% cumulative relative (LCXP index) performance excluding dividends.
European Large Caps Selected List going into 2018
While all our picks offer some defensive features in their respective sectors, our real defensive pillars are AB Inbev, Essity, Novartis (unchanged), and Orange (new idea). ABI is controversial, and we recently issued a 360 Report
as the US business is misunderstood and the Brazilian recovery is underappreciated. Orange is exiting its big capex phase and is set to reap the benefits of its fibre rollout. Our two financials offer a convincing bottom-up case, are very much rate-sensitive, and should do better through a market correction: ABN (replacing BNP, a pure retail bank in a growing economy, capital return story) and Generali (extremely cheap, disposals improving capital, fundamentally well positioned). We also add ABB (strong Swiss balance sheet, late cyclical, cost-cutting) and keep H&M (consensus at rockbottom, most unloved of European large caps, first CMD is upcoming, euro tailwinds) and keep Atos (resilient model, M&A optionality).