Barclays has named a number of global stocks that investors may consider buying before the end of the year, naming “conviction stock ideas with catalysts.” The bank’s list includes six overweight UK stocks, which it gave an average upside potential of 25%. Explaining why they maintained their overweight position in UK stocks, the bank’s analysts said in a stock research note on October 11 that “hopes for domestic recovery remain”, although they noted that “sentiment is cautious going into in the October budget.” “UK shares overall remain very under-owned and look very cheap. FTSE100 short Tech but extension of rally benefits value/defensive-leaning index for now,” they wrote. The analysts also noted that UK domestic players could benefit from “reduced uncertainty and better growth prospects”, which they said could lead to a lower risk premium in the medium term. Here are two of Barclays’ conviction stock ideas, which saw it rise over 35%. SSP Group The biggest gainer stock is SSP Group , a travel food and beverage operator. Barclays describes the stock as having “attractive upside risk due to low valuations.” It expects the shares to rise 46.4% to £2.40 ($3.12) per share over the next 12 months. Shares in SSP are listed on the London Stock Exchange and trade as an American Depositary Receipt (ADR) in the United States under the ticker SSPPF-US. Year to date, the shares have fallen around 30.4 per cent. Barclays attributed its bullish stance to SSP’s “strong returns from investments over the past two years, including from the integration of previous acquisitions.” “We believe ongoing initiatives are in place to drive margin growth (Europe margins have lagged due to renewals, loss-making German highways, industrial rail actions and underlying elements) and a new CEO for Europe has been hired to lead for greater focus,” analysts added. ConvaTec Medical products and technology company ConvaTec is another that is also well positioned due to its balanced growth profile across its business segments, in Barclays’ view. “We see upside potential for accounting guidance, particularly with the delayed implementation of LCD and the assumed buffer for this in guidance,” the bank’s analysts wrote. “We are also encouraged by management’s confidence to achieve 5-7% growth even in a worst-case scenario … and see continued underlying momentum across the businesses driven by strong launch activity,” they added. Shares in ConvaTec are listed on the London Stock Exchange and trade as an ADR in the US under the CNVVF-US ticker. Year to date, the shares have fallen almost 6 per cent. Barclays has a £3.20 target price on the stock, giving it around 39.1% upside potential. — CNBC’s Michael Bloom contributed to this report.
Barclays names global ‘conviction’ stock ideas for Q4