5 Companies That Sell a Lot in Europe. Their Stocks Have Taken a Hit.
The Russia-Ukraine war has put especially pronounced pressure on expectations for economic growth in Europe, so stock in companies that see a big chunk of their sales there has been hit particularly hard.
That’s no surprise. The conflict is a pressing concern in the U.S., given that the price of oil has soared some 60% as sanctions—more could follow—reduce the supply of oil on the international market. That hits home on both side of the Atlantic, but natural gas is an additional concern in Europe because the continent depends on Russian supplies.
Gas prices in Europe are rising even faster than for oil. The Dutch TTF Gas Futures contract has more than tripled this year, putting more strain on consumers in Europe. And sanctions that block Russian banks from using the Swift bank-messaging system create a liquidity risk in that Russian banks and payers may be delayed in making payments to European banks and other businesses.
All that affects investors in the U.S. because about 14% of aggregate sales from
companies have recently come from Europe, according to FactSet.
has a list of stocks with an outsized chunk of sales from Europe. Here are five that rank high in terms of their European exposure:
Only Mondelez immediately responded to a request for comment, saying it has scaled back some of its Russian operations, which represent a small slice of revenue. It didn’t address its exposure to Europe.
The online travel company Bookings gets 79% of its sales from Europe. The stock stock is down 23% since Feb. 10, the day before markets began to reflect the risks of the Russia issue in earnest. The
is down 5% since then.
CNH Industrial NV
a manufacturer of agricultural equipment and commercial vehicles, gets about 48% of sales from Europe. The stock is down 10% since Feb. 10.
The cosmetics company Coty sees 46% of sales from Europe. Its stock has fallen 16%.
Mondelez, meanwhile, gets 41% of sales from Europe, and its stock has declined 8% since Feb. 10.
a provider of consulting and support services for businesses that gets 45% of sales from Europe, have lost 21%.
The good news is that the dramatic downside that these stocks have exhibited means big potential gains if the Russia situation gets better. Hope for a resolution lifted the broaded market on Wednesday, and four of the five ended the day in the black,with gains of between 0.8% and 7%. DXC shares were down 2.9 % after the company received a double downgrade to Underperform from Buy from analysts at Bank of America.
Trading these stocks right now seems to require more than a knowledge of the fundamentals driving the businesses. A strong grasp on the Russia-Ukraine war appears critical as well.
Write to Jacob Sonenshine at email@example.com