By Ben Stern
www.moneymorning.com
If you're looking for ways to profit from soaring emerging market growth, you don't have to go overseas. Some of the best investments to play emerging economies are in the United States. Investors need exposure to emerging market growth, as U.S. GDP grew a paltry 2.2% last year, ranking 137th worldwide. The prospects for this year don't look much better.
By contrast, economies in countries in emerging markets in Asia, Africa and Latin America are growing three to four times faster than the U.S.
Panama's 2012 GDP growth was 8.5%; China, 7.8%; Ghana and several other African nations, close to 8%; Indonesia, 6%; and India, 5.4%.
And some of our favorite U.S. companies have huge percentages of their revenue coming from economies that grow at three to five times the rate of the United States.
www.moneymorning.com
If you're looking for ways to profit from soaring emerging market growth, you don't have to go overseas. Some of the best investments to play emerging economies are in the United States. Investors need exposure to emerging market growth, as U.S. GDP grew a paltry 2.2% last year, ranking 137th worldwide. The prospects for this year don't look much better.
By contrast, economies in countries in emerging markets in Asia, Africa and Latin America are growing three to four times faster than the U.S.
Panama's 2012 GDP growth was 8.5%; China, 7.8%; Ghana and several other African nations, close to 8%; Indonesia, 6%; and India, 5.4%.
And some of our favorite U.S. companies have huge percentages of their revenue coming from economies that grow at three to five times the rate of the United States.
Money Morning Chief Investment Strategist Keith Fitz-Gerald has consistently recommended U.S. companies with a healthy global presence. The best of these companies, Fitz-Gerald says, have great management, pay dividends and offer products and services the world needs instead of merely wants.
"Global companies are great places to hang out if the rally continues and super places to be if things turn defensive," Fitz-Gerald said. "That's because history shows the markets treat them far better than their non-global, non-dividend-paying brethren when the stuff hits the proverbial fan."
Here are some of the best investments among U.S.-based companies operating in emerging markets.
Best Investments: U.S. Companies with Strong Global Growth
Colgate-Palmolive Co. (NYSE: CL): Colgate derives 78% of its revenue outside the United States. Latin America, its biggest market, accounts for 29% of sales; Europe and the South Pacific, 20%; Greater Asia and Africa, 20%; and North America, 18%. Besides its namesake Colgate toothpaste and Palmolive soap, the New York City-based consumer products maker has several other brands, including Irish Spring, Fresh Start detergent and a variety of pet nutrition products. CL currently yields 2.3%Exxon Mobil Corp. (NYSE: XOM): As the world's largest oil and gas company, Exxon will profit as more emerging markets become developed. That process will require a massive influx of energy in those regions and the Irving, TX-based company is poised to profit from the transitions. Non-U.S. revenue accounts for 67% of the company's total sales. Europe, Canada, Japan, Singapore and Australia comprise its biggest markets outside the U.S. XOM currently yields 2.55%.
McDonald's Corp. (NYSE: MCD): With more than 33,000 restaurants in 119 countries, the Oak Brook, IL-based company is now the second largest fast-food restaurant in the world by stores, behind Subway, but remains first in revenue. McDonald's generates less than one-third of its sales in the United States. Europe accounts for the most, with almost 40%, and 23% of sales come from the Asia-Pacific, the Middle East and Africa regions combined.
3M Co. (NYSE: MMM): The maker of Scotch Tape and Post-it notes also makes healthcare, electronic, industrial, telecom and other consumer products. Based in St, Paul, MN, 3M generates 65% of its revenue outside the U.S. More than 30% of sales come from the Asia-Pacific, 22.5% from Europe and the Middle East, and almost 12% from Latin America and Canada. MMM currently yields 2.4%.
Pfizer Inc. (NYSE: PFE): Pfizer is a great way to invest in emerging markets, as well as a solid healthcare play. Pfizer, based in New York City, derives over 61% of its revenue outside the U.S., 20% of that in emerging markets. PFE currently yields 3.3%.
Money Morning's Keith Fitz-Gerald has been following the global growth story for years, picking the next best investments to profit from this trend. And he's delivered our Money Map Report subscribers some huge winners this year - like the world's best "sin" stock that's up over 100% since his recommendation. To learn how you can hear about all of Keith's picks - and to avoid missing the next triple-digit gains - click here.
Source: http://moneymorning.com/2013/04/05/the-best-investments-to-play-emerging-market-growth-may-surprise-you
