Could these global firms provide Brexit protection for your portfolio?

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Brexit jigsaw puzzle

Advertising and marketing giant WPP (LSE: WPP) was the biggest riser in the FTSE 100 this morning. Shares in the firm rose by 3.9%, after the group said revenues rose by 23.4% to £3.6bn during the third quarter.

While 15% of this gain was due to currency effects, today's figures show how well WPP's global portfolio of businesses is performing at the moment. In this article I'll look more closely at WPP. And I'll also consider the attractions of a much smaller -- but still global -- business.

Prepared for the big unknown

The one fact we can all be certain of is that we don't know how Brexit will turn out, or what might change. Looked at this way, WPP's recent statement that it intends to place "even greater emphasis" on its operations in Western Europe seems like a sensible way for boss Sir Martin Sorrell to hedge his bets.

Today's statement suggests that WPP's global profit engine is firing on all cylinders. WPP took the unusual step of stating key figures in three currencies, in order to show genuine underlying growth. Revenue for the first nine months of the year has risen by 15.8% to a bit over £10.1bn. Measured in US dollars, revenue was 5.0% higher, while in Euros it was up 4.7%. The only reported currency in which revenue fell was the Japanese Yen.

Profit margins are still rising, too. WPP's operating margin for the first nine months of the year rose by 0.4% in reported currency (£) and by 0.3% excluding exchange rate movements.

WPP shares currently trade on a 2016 forecast P/E of 16, falling to a P/E of 14 for 2017. A dividend yield of 3.2% is expected this year, rising to 3.5% in 2017. In my view this valuation is probably about right for WPP, so I'd hold at current levels.

Faster growth elsewhere?

I rate WPP as a long-term income investment, but investors looking for growth may find that Empresaria (LSE: EMR) has more to offer. Although it's a relatively small business, with a market cap of just £52.5m, this specialist recruitment group operates in 19 countries across Europe, the Americas and Asia.

During the first half of this year, Empresaria earned roughly 30% of its net fee income in each of the UK, continental Europe and Asia Pacific. The remainder came from the Americas, which is a newer but fast-growing region for the group.

Empresaria's diversified strategy has helped the group to deliver twelve straight quarters of underlying net fee income growth. Measured against this track record, I think the shares look good value on a 2016 forecast P/E of 9.6, falling to 7.5 in 2017.

The firm's dividends are of limited appeal, as Empresaria's forecast yield for this year is just 1%. Although the group generates consistent free cash flow, much of this seems to have been used to fund acquisitions, rather than for dividends. This approach has kept net debt low and helped earnings grow from 5.3p in 2013 to a forecast level of 11.1p per share this year.

Based on this track record, I'm happy to trust that Empresaria's management will continue to deploy their capital wisely, and reward shareholders through rising earnings. In my view, Empresaria could be a good growth buy at current levels.

This opportunity may not come again

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Roland Head owns shares of WPP. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.