Judging by 2015 ETF flows, more and more American investors are allocating a sizable chunk of their portfolios to international equities. But according to Erin Gibbs, equity chief investment officer at S&P Capital IQ, some specific international stocks look far better than others.
Gibbs is a particular fan of European stocks, given the low valuations and high growth potential in European equities. And specifically, she says the best opportunities can be found in three European names: French pharmaceutical company Sanofi, UK retailer Marks & Spencer, and a Swiss company, Zurich Insurance Group.
Sanofi, one of the biggest European companies by market cap, has "just been making a ton of money ever since they bought Genzyme" in 2011.
Still, the stock (which trades as a U.S. ADR under the ticker symbol SNY) is down 4 percent in the past year and is currently trading at a forward price-to-earnings ratio of 15.9, which is below the S&P's P/E of roughly 17.
Gibbs' second pick is Marks and Spencer Group, a multi-line retailer.
"They actually had their first increase in furnishing and clothing sales recently," Gibbs said Wednesday in a "Trading Nation" segment. "In the last couple of quarters, they've been doing well."