Spain is the exception within Europe for Bankinter, since it is the only continental stock market to which they give room for growth for the coming months, of 7.5%. The entity believes that this country, together with Portugal and Ireland, are the “new Germany”, capable of maintaining the most dynamic growth in the European Union. In this sense, Bankinter clarifies his preference for the American stock marketwhich is the one they give the greatest upside potential, with 16.4%, with a “decoupling” with respect to Europe that greatly favors the US.
“Our updated valuations indicate that the American stock market continues to offer sufficiently attractive potential thanks to the Expansion of American corporate results continues to be comfortably higher than that of Europeans (EPS 2025e/26e +13.6%/+12.0% vs +6.8%/+9.0%, respectively), with the possibility of it accelerating somewhat more,” explains Ramón Forcada, director of analysis at Bankinter.
However, the entity does not see potential for revaluation in Europe in the current circumstances and after the good 2024 that it has offered, “even despite the contraction of its business results (EPS 5.5% compared to 9.9% in the United States). United States), the economic stagnation in Germany and the serious difficulties that France is going through, both on the governance and budgetary fronts. Thus, the expert indicates that Europe should have lateralized in 2024 and not having done so will take its toll in 2025, until it readjusts.
At this point, Bankinter recommends reducing risk little by little in Europe, prioritizing companies with high, sustainable dividends and with recurring and stable income. “We opted to concentrate technology exposure in the largest companies with positive net cash and favoring predictable and stable businesses, such as infrastructure and energy networks. As singular exceptions we propose some American banks, defense companies, as well as small caps companies, although in this case only through investment funds,” they develop.
Favorite firms by sectors
In technology, as anticipated, they prefer the heavyweights: Apple, Microsoft, Alphabet, Meta, Amazon and Netflix. In Semiconductors, the selection is: Nvidia, Broadcom, AMD, TSMC, ASML. In defense, another of his favorite segments, is Rheinmetall, Leonardo (one of the values of Tressis Eco30 Walletthe investment fund advised by elEconomista.es), Thales, Indra, BAE, RTX, Gen Dynamics, LH Martin, Northrop and Aerovironment. Four Spanish companies are entering Infrastructure: Vinci, Sacyr, Cellnex, ACS and Ferrovial. In Real Estate: Vonovia, Inm. Colonial, Merlin Properties, AEDAS Homes, Welltower, Prologis and Digital Realty Trust, and in the Health segment, Vonovia, Inm. Colonial, Merlin Properties, AEDAS Homes, Welltower, Prologis and Digital Realty Trust.
And in banks, where Europe has better prospects for Italians, they select JP Morgan, Morgan Stanley, BoA, Caixabank, Intesa and Unicredit. Insurers: Axa, Allianz and Mapfre.
They still do not see China as an investment idea
No changes on this point with respect to recent quarters, from Bankinter They still do not consider China as an investment idea. “The growth prospects are not very encouraging and the stimuli announced, in our opinion, are vague and do not assume real commitments. China is going through a confidence problem as well reflected by the real estate sector and the country’s internal demand,” explains Forcada.
Added to all this, he adds, are the Trump administration’s predictably harsher tariff policies that will penalize exports. “This cocktail raises doubts in the short term and until there is a change in trend we remain on the sidelines of investing in China. Starting with growth, we do not believe that GDP will reach rates of 5% in 2024 (as announced by the Government) in addition to lowering our estimates for 2025 and 2026 to +4.5% (from 4.7% previously) and +4.3% (from 4.5%), respectively. Among the main reasons for defending this argument are the continued weakness of the real estate sector.
Your only option is India among the emerging ones
India is the only region of emerging countries that the entity believes makes sense in the current context. And they argue: “Favourable demographics, investment in infrastructure and digitalization of the economy.” “The prospects in terms of growth [de India] are encouraging and inflation does not seem to be a problem. All this in line with positive real interest rates that offer room for maneuver to the RBI if necessary,” they explain.
Regarding Mexico, Argentina and Brazil, they also continue to remain on the sidelines due to upward risks in growth and political/legal uncertainty.
European and peripheral bank bonds
In the fixed income universe, Bankinter is “really positive” on European bank bonds, just as they were also doing in 2024. In addition to these, they believe that peripheral bonds are attractive to the detriment of core bonds (Germany and France).
“Spain and Portugal are going through a good time in terms of activity (GDP growth higher than in the European Union) and budget management (increased tax collection) that improves risk metrics (Deficit and Debt/GDP). The fundamentals of Italy are not so good, but the Fiscal Deficit drops to -4.3% in 2024 (compared to -7.2% in 2023) and the profitability/IRR of the bonds/BTP is interesting in relative terms,” they argue.
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