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12 Best Emerging Markets Stocks to Buy This Year


May 8, 2020
12 Best Emerging Markets Stocks to Buy This Year

In the past three decades, emerging markets stocks have experienced rapid growth, evolving into one of the most attractive investment spots for investors around the world. Although the 2020 coronavirus pandemic has raised high levels of uncertainty among investors, exposure of investment portfolios in emerging markets is a risk worth taking.

report aprilBecause investing in these markets introduces traders to middle-income countries that have an extremely high potential for fast economic growth. For example, countries like Brazil, Russia, India, and China have had stock markets valuing over $50 billion every year since 1981.

Although the recent shakeup of the economies of these countries has seen the growth rate of the stock market plummet, this could be a great buying opportunity for investors. This post highlights 12 best-emerging markets stocks that you should buy this year.

The Best Emerging Markets Stocks

 

  • Alibaba Group Holding
  • Mobile TeleSystems
  • Taiwan Semiconductor
  • Naspers Limited
  • Telkom Indonesia
  • China Mobile
  • China Life Insurance
  • Baidu
  • PetroChina
  • Cosan Limited
  • Arcos Dorados
  • CNOOC

What is an Emerging Market?

An emerging market constitutes developing countries with a per capita income running within the low and mid-range. The term got formulated by a World Bank economist in 1981. Examples of such markets include India, Saudi Arabia, China, South Korea, Nigeria, and South Africa.

The performance of assets in an emerging global market is measured using an Emerging Markets Index. By 2019, the market index had up to 1194 constituents.

Developing economies with more illiquid capital, riskier, smaller, and less established markets gets referred to as frontier markets. A frontier market is more suitable for investors who are looking for high returns in the long term.

12 Emerging Market Stocks to Buy in 2020

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  1. Alibaba Group Holding

Alibaba, a global leader in cloud and e-commerce services, is expected to grow its annual revenue by 27% in the next fiscal year. With a market cap of over $500 billion, the company has featured in global stock exchanges, including the Hong Kong Stock Exchange and New York Stock Exchange.

Following the coronavirus epidemic, Alibaba shares get said to have only dropped by 20%, with the company’s cloud services expected to boost its profit margins.

  1. Mobile TeleSystems (MBT)

Mobile TeleSystems is a Russian wireless and telecommunications company with a dividend yield of up to 12%. With its stocks scoring ‘A’ grades, valuation metrics indicate that MBT shares may get undervalued.

  1. Taiwan Semiconductor (TSM)

When it comes to integrated circuit manufacturing, Taiwan Semiconductor is a global leader.

The company’s shares were able to weather the economic impact of the trade war in 2019, a sufficient reason to believe in the TSM’s capacity to stand the corona pandemic recession.

TSM has also been exposed to secular capital markets, such as IoT, high-performance computing, and smartphones, placing investors at a high-yield advantage.

  1. Naspers Limited

Naspers is a South African internet company emerging markets, specializing in e-commerce, internet communication, gaming, and entertainment. The company’s capital market value stands at $60 billion today.

  1. Telkom Indonesia

The growth of Indonesia’s population saw the country’s GDP grow by over 8% in 2019. Telkom Indonesia, the giant telecommunications company in the country, has been one of the largest beneficiaries of the macroeconomics of the population.

The dividend yield of Telkom Indonesia stands at 4%, with the annual sales growth hitting the 10% mark.

  1. China Mobile

China Mobile has over 800 million users, making it the largest mobile companies in the world.

The company gets expected to experience radical growth in the future, following its involvement in broadband services and modern businesses. The value of China Mobile’s shares stands at over $50 per share today.

  1. China Life Insurance (LFC)

LFC holds an emerging market share of 30% of China’s life insurance industry. The company experienced an 8% increase in its premiums, with the share price of LFC stock predicted to grow to $15.40 in 2020.

  1. Baidu

Baidu is one of the largest internet companies in China, specializing in artificial intelligence and other internet services. Being the largest search engine in China, Baidu’s annual revenue got projected to grow to 11% by 2023.

  1. PetroChina

China’s largest gas and oil company, PetroChina, has a dividend yield of over 7% today. Although the company’s share price has been affected by the coronavirus crisis, this price gets targeted to hit the $43 soon.

  1. Cosan Limited

Cosan is one of the largest Brazilian companies specializing in energy products, including fuels and natural gas. By 2017, the revenue streams of Cosan hit the $16.1 billion mark, with sales projected to grow spontaneously in upcoming financial years.

  1. Arcos Dorados

Arcos Dorados is a premier foreign direct investment, operating the largest food chain worldwide. When working in twenty countries, the company’s revenue streams get expected to grow by 10% in the next fiscal year.

A stock most investors in the United States and the UK find comfortable to invest in than most of the tech giants in Russia or Indonesia.

  1. CNOOC

CNOOC represents one of the largest oil production and exploration companies based in China, with a market cap of over $380 billion. The company’s stocks offer up to 10% dividend yield to investors.

Final Words

premium bondsEmerging markets are in countries where capital controls have been loosened or are with low per capita income. Famous for investors, but not widely accessible to the general population. Their growth potential in the global market is enormous. Recent weakness in emerging market stocks, especially in emerging markets, can have a severe impact on the worldwide stock market. Especially in the current wake of the coronavirus, the potential of emerging market stocks, especially in China, is enormous.


Disclaimer: This article is not investment advice or an investment recommendation and should not be considered as such. The information above is not an invitation to trade and it does not guarantee or predict future performance. The investor is solely responsible for the risk of their decisions. The analysis and commentary presented do not include any consideration of your personal investment objectives, financial circumstances or needs.

Risk Warning: Our products are traded on margin and carry a high level of risk and it is possible to lose all your capital. These products may not be suitable for everyone and you should ensure that you understand the risks involved.

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