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There are also some overlooked “back doors” into many of the emerging economies, according to Charles Sizemore, owner of Sizemore Capital Management LLC, a boutique research and investment firm.Charles Lewis Sizemore, CFA
While Mr. Sizemore is not a fan of China because of its fuzzy economic data, or Russia “because they tend to throw business executives in jail,” he does believe in tapping some markets from a safe distance.
Telefonica SA (TEF), a telephone services company based in Spain with a price-to-earnings ratio of 7, is deriving 60% of its revenue from European and Latin American emerging markets.
“This is a company that has been left for dead just because it’s based in Spain,” Mr. Sizemore said. “It’s truly absurd; you don’t normally see these kinds of bargains after an emerging-markets rally.”
Another example is Unilever PLC (UL), a 100-year-old blue chip, which is paying a 4% dividend and drawing half its revenue from emerging markets.
In keeping with the emerging-middle-class theme, Mr. Sizemore recommends EGShares Emerging Markets Consumer (ECON), an exchange-traded fund made up of companies that sell to emerging-market consumers.
“That’s an ETF for somebody who wants some real buy-and-hold emerging-markets exposure,” he said.
Chief Investment Officer
Sizemore Capital Management LLC
2633 McKinney Avenue, Suite 130-159 Dallas, Texas 75204
Phone: (214) 717-4935 Fax: (214)-572-7865
