So below is a list of low-priced growth stocks we think offer attractive value for the money. Each stock on the screen has a market cap of at least $500 million, shows strong growth, with 5-year forecasted earnings growth of at least 30%, has trailing P/E ratio of less than 30 and a P/E-to-growth ratio of less than or equal to 1.5.
These names are in the emerging world, susceptible to inflation and the general “risk-off” threat, so please do your own due diligence before adding a position in any of the names below. Here they are:
Tim Holdings Company (TSU): This Brazilian wireless carrier is the third largest mobile phone provider in the country. It provides voice and data mobile telecom services, including voice, picture and texts. Shares trade at $37.09 at the time of writing and the company currently doesn’t pay a dividend, though the company declared a special dividend on 5/5/09. Though the company does not possess an economic moat, in our opinion, the firm’s average revenue per customer is the best in the Brazilian telecom sector.
Tata Motors, Ltd (TTM): Tata is the largest carmaker in India, a market with relatively low automobile penetration rates compared to the developed world. Revenues are ~$20 billion. Yet the company is heavy with debt, the result of The Jaguar Land Rover acquisition in 2009. With the $2,500 Nano car hitting the market, we think Tata and its management will provide investors with solid long-term returns.
Cosan (CZZ): Brazil’s Cosan sells sugar and ethanol products. With sugar prices soaring, Cosan is well positioned to capture the gains from the uptick in the price of this commodity. In addition to solid growth potential, Cosan also pays a substantial 2% dividend and trades on a trailing P/E of 10.15%. Shares change hands at $12.95 at the time of writing.
China Southern Airlines (ZNH): This company operates an airline in China. Pretty simple. As domestic travel heats up in the Peoples Republic, ZNH is well positioned to benefit from this trend. Investors should consider this name if you’re long term bullish on the growth of the intra-China travel industry and airlines in general. We advise you to do your own due diligence on this name as airlines are a historically disappointing industry to operate in. Shares trade at $25.80.
Internet Initiative Japan (IIJI): While not in the emerging markets, this Japanese internet connectivity and outsourcing company offers solid growth prospects. The company controls about 5% of the Japanese Internet access market. Shares trade at $7.83 at the time of writing.
E-House China Holdings Ltd (EJ) This is a Cayman Islands-incorporated holding company that conducts a real estate services business in China. With the already hot real estate market expected to get even hotter, China offers excellent growth prospects to companies like EJ as office rents will continue to rise. Shares trade at $13.59 at the time of writing.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.