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Investment Ideas

With March 17 right around the corner, I thought it would be a good idea to take a look at 3 stocks that come from Ireland. These stocks all trade on the NYSE, so domestic investors could look to these names to add international exposure.

Wearing of the Green

If you are looking for green in your portfolio, one place to look to invest are the professionals that handle the green. By green I mean money, and one opportunity when looking at investing in Irish stocks is Bank of Ireland (IRE).

Bank of Ireland (IRE) is off to a great start this year, with the ADR up about 38% year to date. At $15B its no small cap and on par with Cleveland Ohio based KeyCorp. The stock is also pretty liquid with 850K shares traded on the average day.

Right now, the stock is a Zacks Rank #3 (Hold), and has seen consistent decreases in the underlying loss before taxes. The first half of 2012 saw a loss of 933 million Euros, and that was cut to 566 million Euros in the second half of 2012. The loss was further reduced to 383 million euros through the first half of 2013 and was halved again to 186 million Euros for the second half of 2013.

The bank has 11,500 post office branches and 2,400 ATM's servicing the 1.6 million consumer customers and 600K wealth management customers.

If you are looking for a resurrection of the Celtic Tiger, this is going to be the stock for you. The recent underlying strength in Europe means that IRE is likely to continue to benefit.

No Blarney in This Stone

To kiss the Blarney Stone will give that person the "gift of gab" which is to say they will have a way with words. The stone is located in the Blarney Castle about five miles away from Cork Ireland.

If there would be a company to build the Castle today, CRH PLC (CRH) would be the one. Well for the purposes of this Irish inspired article they would anyway.

CRH PLC (CRH) is a supplier of building materials primarily in Western Europe and North America. The company produces and sells a range of primary materials, including cement, aggregates, ready-mixed concrete, asphalt/bitumen, and agricultural and chemical lime.

Year to date, this stock has built up a gain of 11%, which is good but investors also recently benefited from a $0.60 dividend so you can add on about 3% to that gain.

Over the last year or so, CRH has held a Zacks Rank of between #3 (Hold) and #5 (Strong Sell). The Rank changes when analysts move their earnings estimates. So over the last 12 months or so, there haven't been too many increases to estimates.

December was a strong month for the company as Citigroup upgraded their recommendation from Sell to Neutral on the stock. Later that same month saw Bank of America Merrill Lynch upgrade the stock as well. They moved their rating to Neutral from Under-perform.

Pot O'Gold

They say if you catch a Leprechaun, the "mythical" creature will be forced to tell you where his pot of gold is. Recent horror movies suggest that won't exactly happen and old fables mirror that as the supernatural being will do everything it can to trick you.

Another Irish saying is that there is a pot of gold at the end of the rainbow, and I know from experience it’s hard to run to one end (or the other) of a rainbow. Instead, you might want to employ the services on another Irish company to help you on that adventure.

Fly Leasing (FLY - Snapshot Report) is a Dublin Ireland based company that is leases commercial jet aircraft. I figured that a jet might help you chase the rainbow a little better than just running after it.

The world of commercial aviation is a difficult one where demand for new airplanes outweighs supply. Often times smaller airlines are forced to use the services of companies like FLY as they look add new aircraft as the bigger carriers buy up most of the new production. Another benefit of leasing is not carrying a large asset on the books and this improving ROI.

Over the last five quarters, FLY has posted four beats and one meet, which is a great record for any company. Revenue, however has been seeing a lot of weakens of late as the most recent report on March 6 saw revenue decrease from $131M a year ago to $85M for the most recent quarter.

As I started writing this article, FLY was a Zacks Rank #3 (Hold), but has slipped to a Zacks Rank #4 (Sell) as the estimates have fallen for the stock. The Zacks Consensus Estimate for 2014 has kicked lower from $1.22, where it stood from November through February, to $1.13 in March.

The 2015 Zacks Consensus Estimate has also seen a move lower, and this one is a bigger move. The estimate was at $2.13 as of February, but is now down to $1.75. Those sort of downward earnings estimate revisions are the foundation of the move lower in the Zacks Rank.

Investors might be wise to just use the jets to chase rainbows before investing in this stock. However, a move higher in estimates could signal that the skies are clearing for this stock and there would be no need to chase Leprechaun's or rainbows if that is the case.

Conclusion

Investing in Irish stocks makes for a great pre St. Patrick's Day article. Finding good Irish stocks can be challenging and while international diversification helps investors, waiting to see estimates turn higher is a key strategy to employ.

St. Patrick's Day is right around the corner, we at Zacks hope you enjoy the parades and have a safe holiday.


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Brian Bolan is a Stock Strategist for Zacks.com. He is the Editor in charge of the Zacks Home Run Investor service, a Buy and Hold service where he recommends the stocks in the portfolio.

Brian is also the editor of Breakout Growth Trader a trading service that focuses on small cap stocks and also carries a risk limiting strategy.

Follow Brian Bolan on twitter at @BBolan1

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