Ireland, the fastest-growing economy of the European Union, has gone from strength to strength in the past few years. The Irish labor market is currently tight with unemployment at a 13-year low. Also, the country’s finance ministry has raised its growth forecast for the Celtic Tiger.
Finally, broadly encouraging business conditions and improving Irish wages have also been pivotal in shaping up this economy. Such favorable conditions call for investing in stocks from Ireland.
13-Year Low Unemployment
Per the latest reports from Ireland’s Central Statistics Office (CSO), the country’s unemployment rate remained unchanged at 4.8% in December. This also happens to be the metric’s lowest settlement in the past 13 years. Furthermore, economists remain optimistic about another strong year of employment growth within the Irish economy.
The CSO also reported that the total number of unemployed workers was 119,000 in December. In comparison, this figure was 356,600 or roughly 16% in February 2012. Also, the headline unemployment rate was the lowest since January 2007. Notably, the metric is also three percentage points lower than the eurozone average of 7.5%.
Ireland Increases GDP Forecast for 2020
As the terms of Brexit become clearer, Ireland’s finance ministry expects the country’s economy to grow at a higher pace than earlier expected. The finance ministry expects Ireland’s GDP to have advanced 6.3% in 2019. Also, the expected rate of growth has been pegged at 3.9% for 2020 and 3% for 2021.
The latest estimates are based on the free-trade deal between the European Union and Britain. Terms of this deal include the existing arrangements or a possible extension of the transition period that finishes by the end of 2020.
Rating Agencies Upbeat About Ireland’s Prospects
Two of the world’s leading credit rating agencies recently vested their faith in the prospects of the Irish economy. The agencies expect the country to weather any tensions related to Brexit, geopolitics and trade related concerns.
German agency Scope has kept its credit rating of A+, unchanged for the country. However, it has improved its long-term prognosis of the Irish economy from stable to positive.
On the other hand, another leading rating agency, Moody’s, has stated that the country’s economic growth would remain above the average growth for the eurozone. It expects the country’s GDP to advance 3.2% in 2020, which would remain above the eurozone average of 1.4%. Furthermore, the agency also growth in Ireland’s export and productivity will continue to support the economic growth of Ireland.
4 Best Choices
Such favorable conditions make Ireland’s stocks a hotbed for money. In this context, we have selected four stocks that are expected to gain from these factors. These five stocks flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
CRH plc (CRH - Free Report) is a manufacturer and distributor of building materials.
The company is based out of Dublin and sports a Zacks Rank #1. The expected earnings growth rate for the current year is 0.2%. The Zacks Consensus Estimate for the current year has improved 6.5% over the past 60 days.
Grafton Group plc (GROUF - Free Report) is a provider of merchanting, retailing and mortar manufacturing services.
The company is based out of Dublin and carries a Zacks Rank #2. The expected earnings growth rate for the current year is 6.94%. The Zacks Consensus Estimate for the current year has improved 1.4% over the past 60 days.
Johnson Controls International plc (JCI - Free Report) is the owner and operator of a diversified technology and multi industrial company.
The company is based out of Cork and has a Zacks Rank #2. The expected earnings growth rate for the current year is 29.74%. The Zacks Consensus Estimate for the current year has improved 0.8% over the past 60 days.
Ryanair Holdings plc (RYAAY - Free Report) is a provider of scheduled-passenger airline services.
The Zacks Rank #1 company is based out of Swords. The Zacks Consensus Estimate for the current year has improved 12.1% over the past 60 days.
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