Share of the Week from The Share Centre
Nick Raynor, investment research analyst at The Share Centre, picks medical devices group, Smith & Nephew, as his share of the week. Here’s why:
“The ageing population contributes materially to
Smith & Nephew’s volume growth each year as many of its treatments are for the older generations. Emerging markets also are a key driver for growth as these populations are getting older and wealthier. Its healthcare systems and hospital infrastructure are developing at a robust pace and Smith & Nephew is focusing on deploying its global capabilities to serve local market needs.
“During the last eight years, earnings per share have grown at an annualised rate of 7%, and the return on capital employed has been impressive. At the current valuation, there is plenty of potential for the share price to increase and the yield is starting to improve.
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Smith & Nephew is attractive for investors with a longer term outlook prepared to take a medium risk. However, investors should be aware there will be volatility in these current markets and should not expect an immediate return. Investors will be required to be patient, although the rewards could be worth it.”
THIS DATA IS PROVIDED BY THE SHARE CENTRE. THIS IS NOT INTENDED TO CONSTITUTE AN OFFER OR AGREEMENT TO BUY OR SELL INVESTMENTS.
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