January 8, 2016

Sanofi not Pernod Ricard

It looks like it will be a scary 2016. At least you would think so if you listen to the forecasters. They think stocks will stay flat at best. And on the first Monday of the year, it actually looked like they were right. The Chinese market collapsed again and took the rest for a ride. So what do you do if you have to invest your money? After all, it will only depreciate in value on your bank account as long as the central banks keep printing money. One defensive investment strategy is to go for non-cyclical stocks. This is why Obermatt CEO Dr. Hermann Stern wanted to buy Absolut Vodka maker Pernod Ricard, but the bad safety rating kept him from doing so.

The next best option in France - where Obermatt just published its latest Top 10 List for European stocks - is Sanofi, a pharmaceutical giant. Like many other long-term investors, he is not a drug expert. So he did something new. He used a Morningstar research report to see what people closer to the business are saying. Their opinions are mixed - which is actually always the case for good value stocks. He still went for it because they are said to launch a Cholesterol drug soon that fights one of the most dominant health problems of an increasingly prosperous world.

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