is looking brilliant as analysts are beginning to realize the European economy is in recovery mode. I noticed a truly ignorant statement by one analyst discussing the recovery in Europe.
The increase in volatility and uncertainty we've seen throughout the euro zone is finally coming to an end," said Diane Garnick, chief executive of Clear Alternatives, an asset management firm in New York.
"We are much more comfortable looking at U.S. international companies that have exposure in Europe, given the stability we see there now," Garnick said, adding that she favors Johnson & Johnson (JNJ) over other stocks with big exposure to the domestic market like Walgreen Corp (WAG).
Considering that WAG has a market cap of $46B and they are spending about $15B to acquire Alliance Boots, which owns approximately 2200 drug stores in Europe and a huge wholesale business in Europe, Ms. Garnick is way off base in using WAG as an example of a company with big exposure to the domestic market. CVS and RAD would have been better choices for comparison as they have virtually no exposure outside the U.S.
Indeed, it is clear that the Walgreen board acted in a very timely manner to acquire Alliance Boots just before Europe began to show signs of recovery. This acquisition is part of the reason WAG will be a $100 stock by 2016.