Almost unbelievably we are about to see the Grand Finale of the Game of Thrones (GoT) saga. Very soon we’ll discover who’ll win and take the Iron Throne.
The challenge of finding a winner also relates to the quest to pick stocks and shares. Just as those of us who are fans of the drama have analysed the characters in GoT, and made our assessment of their strengths and weaknesses, we can assess a stock by looking at its Quality, Value, and Momentum.
Working with these three criteria, here are some stock picks for three favourite GoT characters:
Jon Snow has a lot of backing and support from the public. He has also proven he can withstand even the most unexpected of events. There is a spark of innovation to be found: joining forces with the enemy of my enemy turned out to be an excellent move against the Night King’s army, but is it a cursed alliance joining forces with Daenerys?.
Paddy Power and Betfair now operate as a single company having joined forces in 2015. Coming together brought them back from infighting to concentrate on ruling.
Paddy Power Betfair is an excellent Quality stock. The company has a strong balance sheet and plenty of cash. Jon isn’t cash rich, but he has resources: endless people to call upon when required. Paddy Power Betfair’s cash reserves, make them resilient to any new gambling regulations or other changes.
A company’s value is based on today’s price per share, versus how much money the company generates. The higher the value the cheaper it is to buy this company now compared to how much money it’s bringing in i.e. the money being generated will grow into bigger profits (and returns) in the future. Paddy Power Betfair scores highly for Value. They bring in a lot of revenue compared to the stock price today. If they can convert this money into bigger profits there’ll be higher returns for investors. If you’d invested in Jon before you knew about his true heritage, you’d be collecting rewards now! Investing in Paddy Power Betfair has potential for more to come.
Finally, a company’s Momentum. Momentum takes views from industry experts, e.g. big banks and financial institutions, and aggregates them. Do the experts believe this company will barely beat expectations or perhaps completely exceed everyone’s wildest dreams? Paddy Power Betfair is very average in terms of future Momentum. They’re hitting or beating their targets. The industry feels positive, without expecting anything amazing soon.
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