Liberty Global Plc (LBTYA) is a European cable company with a long-term compounding story, as the company continues to buy back stock each year and has the ability to grow free cash flow per share at a mid-teens growth rate, says Jordon Laycob, Co-Manager at Marsico Capital.
“One of the stocks that we’ve owned for quite some time is Liberty Global. It’s a European cable company in Germany, the Netherlands, and recently made an acquisition in the U.K. of another company that we owned, Virgin Media,” Laycob said. “We like this company because the cable business in Europe is further back in the development of their marketplace relative to the U.S., and the cable companies have a significant advantage on speed and the broadband offering to consumers.”
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There is still room for LBTYA to take a significant amount of market share in Europe, as customers there are watching more television and have been more willing to pay for advanced features, Laycob says. This opportunity coupled with the company’s consistent share buybacks make LBTYA a solid stock in Laycob’s portfolio.
“This has been a really good long-term compounding story for us. Liberty Global buys back a significant amount of stock every year and can grow free cash flow per share at mid-teens growth rate. So that’s been a great stock for us,” Laycob said.
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