Are Vodafone Group plc, Booker Group plc and McCarthy & Stone plc set to double in value?

Should you buy these 3 stocks right now? Vodafone Group plc (LON: VOD), Booker Group plc (LON: BOK) and McCarthy & Stone plc (LON: MCS).

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

In recent years, discussing whether Vodafone’s (LSE: VOD) share price could double would have been met with a rather negative reaction by most investors. That’s because the telecoms major has recorded a very disappointing financial performance during the period, with its earnings coming under severe pressure. A key reason for this has been the poor performance of the European economy, to which Vodafone is significantly exposed.

However, with a sound strategy, Vodafone now appears to offer superb capital growth potential. It has invested heavily in its network across Europe and has therefore been able to retain customers as well as attract new ones. Furthermore, Vodafone has broadened the services and products it offers, with it expanding into the UK’s broadband market as well as acquiring discounted assets across Europe.

5 Stocks For Trying To Build Wealth After 50

One notable billionaire made 99% of his current wealth after his 50th birthday. And here at The Motley Fool, we believe it is NEVER too late to start trying to build your fortune in the stock market. Our expert Motley Fool analyst team have shortlisted 5 companies that they believe could be a great fit for investors aged 50+ trying to build long-term, diversified portfolios.

Click here to claim your free copy now!

As a result of these changes, Vodafone is forecast to increase its bottom line by 18% in the current financial year and by a further 29% next year. This means that if Vodafone maintains the same rating, then its shares could be trading over 50% higher within a couple of years. And if Vodafone’s strategy continues to pay off, they could double in value over the medium-to-long term.

Wait and see

Also offering an upbeat forecast is cash and carry specialist Booker (LSE: BOK). Its shares have fallen by 9% since the turn of the year due in part to concerns surrounding the growth rate of the UK economy. As such, Booker’s share price could come under further pressure in the near term – especially as the risk of a Brexit increases.

However, with Booker forecast to increase its bottom line by 13% this year and by a further 10% next year, it remains an above-average growth proposition. The problem, though, is that it trades on a price-to-earnings-growth (PEG) ratio of 1.8 and this indicates that its shares may be fully valued. With them having a narrow margin of safety, it may therefore be worth waiting for a lower share price before piling-in to Booker’s shares.

Long-term pick

Retirement housing specialist McCarthy & Stone (LSE: MCS) has endured a disappointing 2016 thus far. Its shares are down by 12% and this could be due to weakness in the wider housing sector. With investors being concerned at valuations across the UK compared to buyer earnings, there’s a worry that house prices could come under a degree of pressure. That’s especially the case since interest rate rises seem likely over the coming years.

Despite this, McCarthy & Stone has the potential to double over the medium-to-long term. That’s because it trades on a PEG ratio of just 0.3 and this indicates that its shares have the capacity to double in price and still offer good value for money. And with McCarthy & Stone likely to benefit from a demographic tailwind as the number of retirees increases, it could be a sound long-term performer.

Is this little-known company the next ‘Monster’ IPO?

Right now, this ‘screaming BUY’ stock is trading at a steep discount from its IPO price, but it looks like the sky is the limit in the years ahead.

Because this North American company is the clear leader in its field which is estimated to be worth US$261 BILLION by 2025.

The Motley Fool UK analyst team has just published a comprehensive report that shows you exactly why we believe it has so much upside potential.

But I warn you, you’ll need to act quickly, given how fast this ‘Monster IPO’ is already moving.

Click here to see how you can get a copy of this report for yourself today

Peter Stephens owns shares of Vodafone. The Motley Fool UK has recommended Booker. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Social media and digital online concept, woman using smartphone
Investing Articles

Apple stock: Buffett is long, Burry is short. What should I do?

Our author thinks about whether following Warren Buffet into Apple stock might be a good addition to his portfolio –…

Read more »

Close-up of British bank notes
Investing Articles

5 ‘no-brainer’ dividend shares to buy today

Is there an easy way to narrow down the list of FTSE 100 dividend shares? I try one approach, with…

Read more »

Close-up of British bank notes
Investing Articles

£5,000 to invest? 2 dividend-paying penny stocks I’d hold to 2030

I think these high-yielding penny stocks could help cushion the impact of high inflation on my returns. Here's why I'd…

Read more »

Renewable energies concept collage
Investing Articles

2 green stocks that I think are no-brainer buys for the future

Jon Smith explains two of his favourite green stocks at the moment, one for growth and the other for income…

Read more »

An airplane on a runway
Investing Articles

The Rolls-Royce Share price may be set for take-off!

After an upbeat Civil Aerospace Investor Day, here's why I think the Rolls-Royce share price could be set for take-off…

Read more »

A pastel colored growing graph with rising rocket.
Investing Articles

2 beaten-down growth stocks to buy as inflation rises

Despite inflationary pressures and recession concerns, I am looking at some top growth stocks to solidify my portfolio over the…

Read more »

Stack of British pound coins falling on list of share prices
Investing Articles

Is the IAG share price too good to miss at current levels?

Jabran Khan delves deeper into the current state of play with the IAG share price and decides if now is…

Read more »

Young woman working at modern office. Technical price graph and indicator, red and green candlestick chart and stock trading computer screen background.
Investing Articles

5 of the highest-paying income stocks compared! Which one is best for my portfolio?

Income stocks are certainly in vogue right now amid sky-high inflation. But which of these big dividend payers is the…

Read more »