Wall St futures flat amid US-China trade jitters; bank earnings in focus
Investing.com -- European stocks offer compelling investment opportunities across various sectors, according to recent Barclays research.
The bank’s analysis points to several standout performers with significant growth potential, while also highlighting companies facing challenges ahead.
3 Overweight Ideas
Deutsche Bank: Deutsche Bank leads the pack with strong revenue growth prospects as it prepares for its November 17 Investor Day.
Barclays expects the bank to announce a new multi-year plan with targets extending to 2027 or 2028, potentially including 5% annual revenue growth and a return on tangible equity of approximately 12-13% by 2028.
Several factors support Deutsche Bank’s outlook, including German fiscal stimulus, acceleration in investment banking fees, and German pension reform.
Vivendi: Vivendi presents an intriguing opportunity following a recent AMF ruling that could require Bolloré to make an offer on the company by January 18, 2026. This depends on upcoming court decisions expected by year-end.
According to Barclays’ analysis, this situation could potentially deliver significant upside of up to 22% by the offer deadline, representing a 42% annualized return. The bank moved its price target to €3.55, noting the opportunity is "too significant to ignore."
Zurich Airport: Zurich Airport continues to benefit from its "Swiss utility-like asset" status, providing shelter from market volatility. A key catalyst is the upcoming opening of Noida Airport in India, expected in late October 2025.
Commercial flights are set to begin after the Diwali holidays in mid-November. Barclays maintains an optimistic view on the airport’s growth potential and expects the company to avoid major tariff cuts during its next regulatory review.
3 Underweight Ideas
ABB: ABB faces challenges despite its impressive execution and recent outperformance. The stock has risen 25% in the last three months, making it "the most expensive electrical in Europe" at approximately 26x consensus P/E.
Barclays sees 2% downside risk to consensus adjusted EBITA in Q3, noting that the market currently expects growth ahead of what is implied by ABB’s book-to-bill ratio.
Saab: Saab is expected to show decent order intake but faces profitability challenges, particularly from the T-7 contract within its Aeronautics division.
Barclays anticipates Q3 margins in Aeronautics will be pressured by elevated T-7 costs and lack of incremental Boeing volumes. The bank projects slower growth after an extremely strong Q2 and believes Saab’s "relatively smaller scale and stretched valuation" suggest downside risks.
Sonova: Sonova rounds out the top five with an Underweight rating and CHF 215 price target. Ahead of November 14 half-year results, analyst Hassan Al-Wakeel sees downside risk to full-year guidance despite management’s optimism about new product launches.
Barclays forecasts 6.4% currency-adjusted growth versus the 7.0% consensus and 5-9% guidance range, noting potential share losses in key markets.
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