The Motley Fool

Why I Think Wm. Morrison Supermarkets plc Has Potential

As all Fools know, forecasts are often wrong.

Of course, I’m not only referring to the investment world: predictions in any walk of life can only ever be used as a guide and never looked upon with any degree of certainty.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

Obvious point, I know. But in the investment world, a degree of weight seems to be given to certain forecasts surrounding economic growth. Indeed, if growth forecasts are changed upwards or downwards, it seems to have at least some impact on investors’ mindset — in the short run at least.

So, I was encouraged to read recently that the British Chamber of Commerce has increased its growth forecasts for the UK economy. It had previously predicted that the economy would grow by 0.9% this year and 1.9% in 2014. However, it has no increased these figures to 1.3% and 2.2% respectively.

Indeed, other surveys of confidence in the UK seem to be advancing too. The GfK Consumer Confidence Barometer, based on a survey of around 2,000 people, increased to its highest level since 2009.

Clearly, the UK is becoming more optimistic than in previous years, although the scale of pessimism since 2009 means this is arguably not that great an achievement.

However, as a private investor I’m always looking to profit from things such as improved sentiment, and one stock that I feel could benefit is Morrisons (LSE: MRW) (NASDAQOTH: MRWSY.US).

As you are no doubt aware, trading conditions have been highly challenging in recent years, with many shoppers seemingly deserting Morrisons in favour of cheaper alternatives, such as Aldi and Lidl.

However, I think that if the UK does continue to experience an upturn, these ‘deserters’ could come back to Morrisons; attracted by its fresh offering, vertical integration and the excellent value (rather than just cheapness) that it offers.

Certainly, they could also be attracted to rival supermarkets such as Tesco and Sainsbury’s, but Morrisons is arguably the supermarket that is ‘one up’ from the likes of Aldi and Lidl.

In other words, consumers moving up the ‘supermarket ladder’ seeking better quality products will arguably reach Morrisons first, then Tesco, then Sainsbury’s and finally Waitrose. So, Morrisons could be the first to gain.

Furthermore, shares offer an attractive yield of 4%, with dividends per share having been increased in each of the last four years. For income-seeking investors like me, such a yield (and dividend growth) is very welcome in the current economic climate.

“This Stock Could Be Like Buying Amazon in 1997”

I'm sure you'll agree that's quite the statement from Motley Fool Co-Founder Tom Gardner.

But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.

What's more, we firmly believe there's still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.

And right now, we're giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool.

Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge!

> Peter owns shares in Morrisons. The Motley Fool owns shares in Tesco and has recommended shares in Morrisons.

Our 6 'Best Buys Now' Shares

Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply click below to discover how you can take advantage of this.