I’m in my mid-30s.
Which means that I’m at a stage of my life when I need to buy my own apartment.
Unfortunately for me, local real estate prices have skyrocketed in the last two years.
Yesterday, I caught myself thinking: “Why didn’t I buy something when the market was cheaper?”
Hindsight is 20/20, right?
But the thought reminded me of a valuable lesson.
With any kind of investing, you must be somewhat contrarian and find the courage to buy before everyone else.
This often means entering into a depressed market. In my case, for example, it would have meant buying an apartment after the housing bubble burst.
To prevent another case of “Hindsight is 20/20” in 2020, I’ve analyzed global financial markets in search of depressed stocks ready to shoot up.
Here is one such opportunity…
Europe’s Industrial Powerhouse Is Set For A Stellar 2020
Over the last two years, investors have shunned few markets as much as Germany.
Germany’s export-oriented country is much at the mercy of the health of the global economy.
In the face of global GDP growth worries, Germany was in a seemingly hopeless situation.
However, all of the factors creating global concern have resolved.
There was, for example, the uncertainty surrounding Brexit.
Up until a week ago, no one had a clue whether there would be a deal, no-deal… or maybe the whole charade would simply be forgotten, and things in the UK would return to the way they were.
With Boris Johnson winning the general elections, that uncertainty is finally gone.
Companies now know what the future holds and can adjust their operations accordingly, instead of being stuck in limbo.
Then there was the U.S.-China trade war.
The United States and China are the first- and second-largest economies in the world. Moreover, they represent Germany’s largest export markets outside the European Union.
The ongoing dispute resulted in a significant economic slowdown in both countries and, consequently, in Germany.
However, with the Phase One trade deal agreed, these economies are projected to pick up.
The third and final global growth worry was the central banks’ tightening policies.
Out of four major central banks, three began shrinking their balance sheets in 2018, the end result of which was last December’s double-digit stock market crash.
This quickly prompted the most powerful central bank, the Fed, to cut interest rates and even launch a new quantitative easing program.
At present, all four major central banks have adopted a dovish stance, supplying the global economy with a fresh supply of cash.
As a result, investing in German companies, especially at the current depressed levels, makes much sense.
Here are my top three choices…
Profit From The Recovering German Economy With These Three Companies
When it comes to German exports, no product can match automobiles. Hence, my first pick is Daimler (DDAIF).
The stock has declined nearly 40% since its 2018 peak and is now trading at a considerable discount.
With a PE ratio of only 13.22 and a 6.42% dividend yield, it puts most S&P 500 stocks to shame.
Moreover, last quarter’s figures showed the company is again growing revenues, after a decline in the first half of the year.
My second pick is another auto manufacturer—Volkswagen (VWAGY).
The market has rallied behind this stock in the last six months, resulting in a 22.04% price increase.
Moreover, the most recent quarterly report showed that the company increased its revenues by an impressive 6.40% year on year.
Despite this, Volkswagen is still trading at a discount with a PE ratio of only 6.56, so it’s not too late to buy in.
The third German stock I want to highlight for you right now is Deutsche Post (DPSGY).
I’ve actually been recommending this one since January. In the 11 months since, the stock has returned more than 40%.
At a PE ratio of 16.64, Deutsche Post is not trading as cheap as my two other picks. However, with traditional retail channels dying and the rise of e-commerce, logistics companies, in general, make a lot of sense.
And, compared with its competitors, such as UPS and FedEx, Deutsche Post trades at a much lower price.