The latest round of stock market volatility is creating compelling entry points on some of the largest international franchises. The roster below is truly global in nature: China, India, Japan and Europe are all represented, and each company is a dominant brand name on a regional and global stage. All of these companies face their own respective issues, but the problems are largely priced to reflect company specific or industry issues, and each security is backed by huge institutional support, rising dividend yields and brand names that earn them global cache. I chose to mix the new with the old: Tata Motors (NYSE:TTM) and China Life (NYSE:LFC) had burst onto the scene to capture the imagination of investors looking to cash in on the growth in the consumer classes of emerging markets. Such enthusiasm has cooled, serving up compelling growth at lower valuations.
Sony (NYSE:SNE) and Total (NYSE:TOT) are old hands, but have fallen out of favor because of an awkward transition in the product portfolio for the former and a sell-off in commodities in the latter. Both are dominant players with decades of staying power. General market malaise has helped kick the door in even further on valuations. HSBC (HBC) fared better in the 2008 financial crises than other global banks, but it has not been spared from the latest downdraft in spite of having arguably the best global footprint among large banks. Market sentiment has these issues on their heels again as investors are prone to sell equities and stampede towards cash and treasuries. This has been precisely the time to buy. Be greedy when others are fearful, and of course, don’t forget that the inverse holds true as well.
|China Life (LFC)||34||(44%)||2.3%||Full spectrum insurance titan in world's largest market.|
|Tata Motors (TTM)||15||(29%)||2.7%||Diversified Indian auto maker positioned to capture market share in China, beyond.|
|Sony (SNE)||18||(40%)-||1.5%||Low margin consumer electronic behemoth looking looking to expand to health care and other high margin businesses.|
|Total (TOT)||42||(18%)||3.0%||French oil major aggressively expanding clean energy portfolio for growth. Drop in oil prices likely temporary.3|
|HSBC Bank (HBC)||37||(28%)||4.7%||Risk profile much lower than many global banks; dominant position in emerging markets|
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.