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Can he FTSE 100 Make investors rich? Many people probably dismiss it as a dividend payer full of boring but well-established businesses.
The rapid action is coming in the US market, some would say, where powerful tech companies are defying the laws of valuation and skyrocketing without a care in the world.
The best local players
However, the Footsie has within its ranks some powerful market drivers that have been leaving the overall index's performance far behind.
To my shame I fell asleep at the wheel with one of them. But if I had been more alert, this growing company could have boosted my portfolio.
It's time to correct that error of omission and focus on this beloved growth with a view to taking action. The business in question is InterContinental Hotel Group (LSE: IHG).
Who would have thought? I was caught off guard by assuming that the hotel operator was a cyclical leaf blowing in the winds of macroeconomic change. Well, it's a cyclical sector, of course, but that's not the whole story. This giant has been expanding and rapidly!
Just look at the chart to get a summary of the growth story here.
If you had been smart enough to have invested £5,000 in shares 10 years ago, you would now have around £19,350 with dividends on top.
If you had invested that £5,000 in InterContinental Hotels Group shares 20 years ago, it would now be worth around £60,500 plus all the dividends along the way.
That contrasts with the performance of the FTSE 100 overall, which would have grown my money to just £9,850, plus dividends, over the past two decades.
More relentless progress
Is It Too Late to Get Involved in InterContinental Hotels Group Stock? I don't think so. Today's third quarter trading update shows more steady progress and a continuation of the company's growth strategy.
In the nine months to the end of September, revenue per available room (RevPAR) increased 1.5% year-on-year. Meanwhile, in a measure of the size of this beast of a business, the company opened 17,500 rooms in 98 hotels in the period, which is “well more than double the same period last year”.
The company now operates worldwide, but that adds risk. For example, the company is in places like China and other territories that may not share the UK's general worldview. That is why I see the company vulnerable to the effects of possible geopolitical tensions and economic shocks.
On top of that, there are cyclical uncertainties in the sector: a half-decent global recession would almost certainly lead to a loss of profits and a drop in the share price.
However, with the ever-increasing rise of the world class of wealthy and financially well-off individuals, I believe demand for the company's multiple hotel brands will likely continue to grow.
Meanwhile, InterContinental Hotel Group's proven growth strategy can help it achieve greater gains for shareholders in the years ahead. So now I am delving into some research with a view to purchasing some of the shares to hold for the long term.
