A bitter pill
2015 has been a bumpy year for AstraZeneca (LSE: AZN), asit continues to suffer from loss of exclusivity on its leading blockbuster drugs and competition from generics. This is a bitter pill for investors to swallow but there is an antidote, withchief executive Pascal Soriotdriving through anew generation of blockbuster cancer drugs and focusing heavily on diabetesin a bid todeliver revenue of $45bn-plus by 2023.
As HSBC recentlynoted, AZNhas a large amount of news flow on late-stage research & development pipeline products due before the year-end. At 15 times earnings AZN is nicely priced (if not exactly cheap). Yielding 4.20% it isnt a dividend behemoth but a steady Eddie. But its investing wisely in its future and now could be a good time for long-term investors to jump in.
Viva Aviva
I bought into theAviva (LSE: AV) turnaround story some years ago and although I am nicely up overall the last year has been a disappointment, with the share price down 12%. Now that its purchase of Friends Life is out of the way, management should be free to focus on driving the new business forward, buoyed by a healthy balance sheet.
Half-year results showAviva becoming a leaner, meaner company, trading at less than 10 times earnings the valuation is lean and mean as well. The yield is a tepid3.83% but management did hike the dividendby 15% recently, and further progression should be expected.
Take Cover
Themany investors who put their faith inGlaxoSmithKline (LSE: GSK) havebeen poorly rewarded, as the share price is up a meagre 5% on five years ago. The joy of this stock is the yield, which is now over6% and management is keen to further reward loyal shareholders with special dividends on top. But dont get too carried away, as cover is looking dangerously thin at 1.2 times.
Bank of America Merrill Lynch recently upgraded GlaxoSmithKline to neutral from underperform, noting that the stock is trading 18% off its April highs. Forecast earnings per share growth of 12% next year points to a morepromising future, as doesthe pipeline news flow. GlaxoSmithKlinedoes need some good news, iftodays juicy dividend is to be sustained into 2017 and beyond. Recent bad news makes todayan appealing entry point.
Dear Prudence
Insurer Prudential (LSE: PRU) remains one of my portfolios best long-term performers yet it isdown 16% in the last six months. After its multi-year Asian growth spurt some kind of steadying off was inevitable. Sadly, it hasnt done much for the yield, currently 2.64%, but at 14 times earnings Pruis notably cheaper than it was.
Asia has been more curse than blessing in recent months, especially since Prus asset management arm M&G is highly exposed to the regions stock markets. The share price may be struggling but the company itself continues to grow andthis mismatch makes now a good time to buy.
Household Goodie
Unilever (LSE: ULVR) is another long-term FTSE 100 favourite taking a bashing on slowing Chinese growthexpectations. It took a further knock last month, when Goldman Sachs shockingly downgraded it to sell.
Im used to Unilever trading at more than 20 times earnings so todays P/E of 15.88 looks like bargain territory. The yield is slightly tastier than of yore, at 3.45%. Market conditions are challenging, but Unilevers sales are still growing, and if youve waited as long as I have for a decent opportunity to buy, you might have to accept that this is it.
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Harvey Jones holds shares in Aviva and Prudential. The Motley Fool UK owns shares in Unilever. The Motley Fool UK has recommended GlaxoSmithKline. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.