Billionaire Mark Mobius has decided to invest a great deal of his own money in emerging-market stocks. Mobius, who’s quite interested in India, South Korea and Taiwan, recently wrote “We are seeking companies that have established international diversification, and we’ve come across numerous enterprises with remarkable technological prowess that enables them to broaden their investor outreach.”
Many emerging markets are growing much quicker than the United States. One such country is India, whose gross domestic product (GDP) is expanding at an extremely rapid 7% clip. For those who wish to emulate Mobius and take advantage of emerging markets’ great potential, here are three excellent emerging-market stocks to buy in August.
ICICI Bank (IBN)
As I mentioned in the introduction, India’s economy is growing at a very rapid, 7% annual clip, attracting the attention of billionaire Mark Mobius and many other large investors.
The country is benefiting, among other things, from an influx of manufacturing as many firms are transferring their factories from China to India. Also helping the Indian economy are the relatively high education levels of its middle class and its close relationship with the United States.
The strong trajectory of the Indian economy is quite positive for one of the nation’s largest financial institutions, ICICI Bank (NYSE:IBN).
Of course, as Indian companies and consumers grow wealthier, IBN should be able to offer many more profitable loans, greatly boosting its top and bottom lines.
Indeed, analysts, on average, expect its earnings per share to climb to $1.43 next year from $1.19 in 2022.
The shares are changing hands at an attractive forward price-earnings ratio of 16.5.
MercadoLibre (MELI)
MercadoLibre (NASDAQ:MELI), a Latin American e-commerce and fintech giant, continues to deliver stellar results.
Last quarter, its income from operations climbed over 100% year-over-year to $558 million, while the total payments volume of its fintech unit soared 129% year-over-year.
Also encouragingly, its unique active users last quarter soared to 109 million at the end of last quarter from 84 million in June 2022.
On Aug. 22, investment bank Wedbush Securities started coverage of MELI stock with an Outperform rating and a $1,500 price target. The firm believes the company’s logistics services are widespread, while advertising sales and higher use of its logistics services by merchants are helping to raise the amount of profits that MELI obtains from each transaction.
The bank expects the company’s platform monetization to climb over the long term, and it predicts that MELI’s top line will increase at a compound annual growth rate (CAGR) of 17% through 2027.
JD.com (JD)
Chinese e-commerce giant JD.com (NASDAQ:JD) reported strong second-quarter results on Aug. 16. Partially driven by a 30% year-over-year increase in JD’s net services revenue, the company’s bottom line jumped to 8.7 million Chinese yuan from 5.8 billion Chinese yuan in Q2 of 2022.
Also encouragingly, the number of merchants on the company’s platform climbed over 100% year-over-year to a record level. As consumers find that they have many more choices on the platform, they should buy more products on it and return to it more frequently, causing more merchants to join and creating a virtuous cycle.
And in another encouraging development, JD reported expanding its partnerships with multiple, major drug companies, including Novartis (NYSE:NVS) and Novo Nordisk (NYSE:NVO). Additionally, the company launched a medical service for elderly Chinese citizens. Given the deficiencies of China’s health insurance system, selling prescription drugs and providing doctors at affordable prices could become very lucrative for JD.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
