Seven Ways to Invest in Chile

Forget BRIC, how about BAC, Brazil, Argentina, and Chile? I’ve covered Brazil and Argentina in previous articles, so now it’s time to write about the ‘narrow’ country.

According to the Central Bank of Chile, Chile has had strong economic growth during the last few years due to the higher price of copper, one of their major exports. They are continuing with privatization, free trade and foreign investment. Unemployment started dropping in 2005 and inflation has not been above 5% since 1998. Besides copper and gold, the country also exports lumber, fresh fruit, processed food, seafood, and wine [there seem to be a lot of counties getting into wine production now].

Fortunately, there are several Chilean stocks with ADRs that trade on the New York Stock Exchange, and most of them pay a dividend.

Masisa S.A. (MYS) is a forestry and lumber company. It has a P/E of 42, a PEG of 1.2, and a yield of .6%. Year-over-year quarterly earnings were up a huge 177% on just a slight 1.9% revenue growth.

Chemical & Mining Co. of Chile Inc. (SQM), also known as Sociedad de Chile SC, produces and sells potassium nitrate, iodine, lithium carbonate, plant nutrients and other industrial chemicals. It has a P/E of 28 and a yield of 1.7%.

Banco de Chile (BCH) has a P/E of 14.6 and a PEG of 2.1. It pays a nice yield of 3.6%.

Compania de Telecommunicaciones de Chile S.A. (CTC) is a $4.2 million telephone company [market cap] which has a P/E of 28 and a yield of 1.7%. Its quarterly earnings were up over 25% year-over-year.

Enersis S.A. (ENI) provides electricity to Chile, Argentina, Brazil, Colombia, and Peru. It carries a P/E of 31.7 and a PEG of 3.1%. It also pays a yield of 1.1%.

The banking company Banco Santander-Chile (SAN) has a P/E of 16 and a PEG of 1.2.

Distribucion y Servicio S.A. (DYS) is an operator of supermarkets in Chile. It has a P/E of 41, a PEG of 2.4, and a yield of 1.1%.

Disclosure: The author does not own any of the above.

Comments

[David Hunkar]

Nice list.Thanks for the compilation.