Rodney Hobson's 4 Stock Tips

ASK THE EXPERT: Morningstar caught up with columnist Rodney Hobson at the London Investor Show to ask what his favoured four UK companies are at the moment

Emma Wall 3 November, 2014 | 9:37AM
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Emma Wall: Hello, and welcome to the Morningstar series, “Ask the Expert.” I’m Emma Wall, and I’m here at the London Investor Show with Morningstar columnist, Rodney Hobson.

Hello, Rodney.

Rodney Hobson: Hello, there.

Wall: So I wanted to ask you about three stocks that you liked at the moment?

Hobson: I’m looking at companies that have solid earnings, earnings growth, paying good dividends, good yields. And the three I like are GlaxoSmithKline (GSK), where with an aging population would always going to need pharmaceutical companies; United Utilities (UU.) and National Grid (NG.) in the utility side; again this is a defensive area where shares are secure or reasonably secure as one can be; and also Royal Dutch Shell (RDSB). Now these are all companies that I have a stake in. They’re all solid companies. They’re all paying good dividends. That to me is what people should be looking for, especially if they are thinking for the long term.

Wall: And of course, the great thing about income, especially those sort of solid, defensive style stocks that people who read your column will be familiar with, is that you can reinvest that income in the growth stage of your retirement plan, can’t you? And reinvesting that income, it can actually mean that you double your money in half the time?

Hobson: The thing about companies that pay a dividend is that you do have that choice. Yes, you can take the dividend and live off the income, great. But if you’re wanting to invest for the long term, yes, keep reinvesting the income and you have the option. And you don’t have to reinvest in the same companies, of course, you can put it into other companies if the stock market is looking that way.

Wall: Rodney, thank you very much.

Hobson: My pleasure.

Wall: This is Emma Wall for Morningstar. Thank you for watching.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
GSK PLC1,523.50 GBX0.89Rating
National Grid PLC963.20 GBX0.80Rating
United Utilities Group PLC Class A1,009.00 GBX0.30Rating

About Author

Emma Wall  is former Senior International Editor for Morningstar

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