Just as U.S multinationals take a hit on a stronger U.S. dollar, foreign multinationals with lots of U.S. sales get a boost.
There’s a long list of overseas companies with significant U.S. revenue, but one of the best is Diageo (DEO). This U.K.-based alcohol company’s portfolio of brands is enormous, including Johnnie Walker, Ketel One, Tanqueray, Guinness and Dom Perignon.
That stable of premium brands allows Diageo to have pricing power. Throw in a weaker U.S. dollar, and you get nice organic sales growth (that is, revenue excluding the effects of acquisitions). In the most recent quarter, DEO said North American organic sales rose more than 5%, helped by price hikes and a weaker dollar.
The 3% dividend yield on DEO stock looks good too.
As of this writing, Dan Burrows did not hold a position in any of the aforementioned securities.