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Ireland’s economy and market have been struggling over the past few years. Its stock market capitalization was around $60 billion at the end of 2010, down from $163 billion in 2006.(1) There are about 60 companies listed. The property market has collapsed and unemployment has surged upward since 2008. The global financial meltdown pushed Ireland into its first recession since the 1980s. Toxic bank loans represented 50% of GDP. The Republic of Ireland has 4.5 million people (of 6.2 million on the entire island) and an economy of approximately $172.5 billion in 2009. From 2008-2009, the economy collapsed by 11.3% (.pdf).

Irish Companies traded on the NYSE and NASDAQ

Name

Ticker

U.S. Exchange

Annual Sales ($ Millions)

Market Capitalization on March 15, 2011

($ Billions)

CRH PLC

(CRH)

NYSE

24,235

14.7

Ryanair Holdings plc

(RYAAY)

NASDAQ

3,675

8.2

Elan Corporation, plc

(ELN)

NYSE

1,170

3.7

Allied Irish Banks, p.l.c.

(AIB)

NYSE

11,798

1.6

ICON plc

(ICLR)

NASDAQ

1,258

1.3

Trinity Biotech plc

(TRIB)

NASDAQ

126

0.2

Source: Yahoo!Finance downloaded on March 15, 2011.

Stock Snapshots

The following stocks are some of the leading Irish companies that are readily traded in the U.S.

CRH plc (NYSE: CRH) - Construction - CRH has a market capitalization of $14.74 billion. CRH closed most recently at $20.81 per share with a dividend yield of 5.8 percent. CRH has an enterprise value of $19.7 billion and shows some financial leverage. CRH closed Tuesday at $20.81 per share which is 41% above its 52-week low of $14.76 and 41.5% below its 52-week high of $29.44 per share. CRH has a very low price to sales ratio at 0.6x. On an operating cash flow basis, CRH appears to be a good value with upside.

Ryanair Holdings plc (Nasdaq: RYAAY) - Airlines - RYAAY has a market capitalization of $8.22 billion. RYAAY has an enterprise value of $9.73 billion and shows some financial leverage. RYAAY shows a trailing P/E ratio of 16.7x which decreases compared to its forward P/E which is 10.5x. This suggests strong earnings per share growth. RYAAY closed Tuesday at $27.58 per share which is 28% above its 52-week low of $21.55 and 21% below its 52-week high of $33.38 per share. RYAAY has a low price to sales ratio at 2.2x. On an operating cash flow basis, RYAAY appears to be a good value with upside.

Elan Corporation, plc (NYSE: ELN) - Pharmaceuticals - ELN has a market capitalization of $3.67 billion. ELN has an enterprise value of $4.516 billion and shows some financial leverage. ELN shows a trailing P/E ratio less than 0 which improves compared to its forward P/E which is 156.5x. ELN closed Tuesday at $6.26 per share which is 44.6% above its 52-week low of $4.33 and 30.7% below its 52-week high of $8.18 per share. ELN has a medium price to sales ratio at 3.1x. On an operating cash flow basis, ELN appears to be overpriced.

Allied Irish Banks, p.l.c. (NYSE: AIB) - Banking - AIB has a market capitalization of $1.62 billion. AIB has an enterprise value of $81.23 million to be overpriced AIB just closed at $3.01 per share which is 3.8% above its 52-week low of $2.9 and 690.4% below its 52-week high of $23.79 per share. AIB has a very low price to sales ratio at 0.1x. On an operating cash flow basis, AIB appears to be overpriced.

ICON plc (NASDAQ: ICLR) - Healthcare - ICLR has a market capitalization of $1.260 billion. ICLR has an enterprise value of $1.029 billion and shows negative financial leverage. ICLR shows a trailing P/E ratio of 14.5x which decreases compared to its forward P/E which is 13.5x. This suggests mild earnings per share growth. ICLR just closed at $20.94 per share which is 8.9% above its 52-week low of $19.22 and 43.2% below its 52-week high of $29.99 per share. ICLR has a low price to sales ratio at 1x. Has a negative operating cash flow.

Trinity Biotech plc (NASDAQ: TRIB) - Biotech - TRIB has a market capitalization of $203.6 million. TRIB has an enterprise value of $150 million and shows negative financial leverage. TRIB shows a trailing P/E ratio of 3.4x which increases compared to its forward P/E which is 13.3x. TRIB just closed at $9.6 per share which is 88.6% above its 52-week low of $5.09 and 2.9% below its 52-week high of $9.88 per share. TRIB has a low price to sales ratio at 1.6x.

ETF Exposure

The best broad way to gain exposure to Ireland is through the iShares MSCI Ireland ETF (EIRL) which provides exposure to the aforementioned companies. EIRL, having been launched in May of 2010, has a limited history. However, over that time frame, it is up about 8.5% including a dividend payment. Its major holdings are in consumer defense (25% of assets), industrials (16%), and basic materials (27%). The meltdown wiped out financial stocks, which only comprise about 10% of its assets. However, with less than $7 million in assets, this might not be the most stable ETF.

Conclusion

Investing in Ireland right now is not for the faint of heart; however, there might be some opportunities for more intrepid investors. The best candidates might be CRH and RYAAY for long term growth. For now, I’ll just stick to Guinness as a liquid Irish investment.

1. Traded market sizes and number of public companies are from World Federation of Exchanges.

Source: 7 Ways to Invest in Ireland

Additional disclosure: This article is for informational and educational purposes only and shall not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, recommendation or endorsement to buy or sell any security.