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Lloyds Bank! I’d forget it and buy this strong stock to get rich

first_img Kevin Godbold | Tuesday, 12th May, 2020 | More on: LLOY TET See all posts by Kevin Godbold I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Lloyds Bank! I’d forget it and buy this strong stock to get rich Kevin Godbold has no position in any share mentioned. The Motley Fool UK has recommended Lloyds Banking Group and Treatt. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Our 6 ‘Best Buys Now’ Shares Image source: Getty Images. Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee.center_img Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Simply click below to discover how you can take advantage of this. The shareholders of Lloyds Banking Group (LSE: LLOY) must be fed up. Over the past few years, the stock has been a serial disappointer.Apart from a brief period of excitement in 2009 when the share shot up from its credit-crunch lows, it’s travelled essentially sideways. And now, at around 30p, Lloyds is back near where it was in those dark days following the financial crisis of the noughties.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Lloyds Bank has underperformedA long and sustainable recovery didn’t materialise. Instead, time after time, Lloyds has demonstrated its vulnerability to the cyclical winds that buffet the stock market and economies.And what now? As we face potentially the biggest economic slump in around 300 years, is it wise to place our faith and money in the shares of Lloyds? I wouldn’t. We’ve had ample experience of the stock’s tendency to underperform in relatively benign conditions. As things get more serious in the economy, I’d rather be elsewhere.Luckily there are many opportunities in the stock market. And resilient businesses back a lot of shares in a way that’s strikingly different from the anaemic operations behind Lloyds. One great example is Treatt (LSE: TET), which manufactures ingredients for the flavour, fragrance and consumer goods markets. Treatt plunged because of the coronavirus crisis. But a big difference between Lloyds and Treatt is the smaller company’s bounce-back over recent weeks. Indeed, with the share price close to 499p, it’s now just 8% lower than immediately before the crisis broke.Strength in the underlying businessAnd the reason for the strength in the share price is the resilience of the underlying business. In today’s half-year results report, the company said: “Covid-19 has had no adverse impact on trading performance to date.”Chief executive Daemmon Reeve explained some weakness in the citrus raw material markets affected the first-half figures, but H2 “is likely to witness an improvement in this category.”  But higher-margin tea, health & wellness and fruit & vegetable categories are driving growth.Today’s figures show revenue and profits down by single-digit percentages compared to the equivalent period the prior year. But the directors slapped just over 8% on the interim dividend, continuing a long record of dividend progress. This is a very different story from the dividend axing we’ve seen with many other companies during this crisis.Looking ahead, Reeve reckons it’s difficult to forecast the likely impact of the coronavirus on demand for the firm’s products. He concedes there may be a slowdown in some customers’ new product development activities in the short term.  But he’s “encouraged” by the level of the order book and the current demand for “beverage ingredients through to solutions for hand soaps and cleaning products.” The balance sheet looks robust, with a net cash position. And trading seems steady. Although the forward-looking earnings multiple runs just below a full-looking 25 for the current trading year, I reckon Treatt has earned its rating. And with the prospect of further gentle growth ahead, I’d much rather be holding the firm’s shares in my quest to get rich and retire early than I would those of Lloyds. “This Stock Could Be Like Buying Amazon in 1997” Enter Your Email Addresslast_img read more