A large portion of the U.K. population wants out of the European Union. But politicians are finding it hard to implement their wishes. The result: Brexit drags on and on, wearing down business confidence and claiming political victims along the way, like outgoing Prime Minister Theresa May.
He’s been focusing on cheap stocks with solid cash flow. We’ll get to some names in a moment. But first, here’s why you should have faith in the U.K. economy and stocks. What’s holding back growth? The labor market is strong for the wrong reasons, at least in part. It’s robust because business confidence is weak. This weakness has businesses pulling back on capital spending. To keep business humming, they’re adding labor in lieu of new equipment, says Raja. Bank of England credit-conditions reports continue to show falling credit demand from medium and large businesses. Foreign direct investment is also weak.
Here’s a quick look at eight U.K.-based companies with U.S. listings favored by fund managers I recently interviewed about investing in Britain. J.P. Morgan has overweight ratings on consumer-goods group Reckitt Benckiser Group RBGLY, -0.62% RB, +0.16% and supermarket chain Tesco TSCDY, -0.66% TSCO, -0.39%