Globalize Your Portfolio With These 5 Emerging Market Stocks

Adding to the already decent start to the year (improving growth prospects globally, pick up in manufacturing and stabilizing oil prices), the new report from the World Bank projected global economic growth of 2.7% for 2017 and 2.9% for next two years.

Specifically, advanced economies (the U.S., Eurozone and Japan) are anticipated to grow at the rate of 1.9% this year, then decline to 1.8% and 1.7% for 2018 and 2019, respectively. Now if you look at the growth projections for emerging and developing economies, it is 4.1% for 2017, while improving to 4.5% for 2018 and 4.7% for 2019.

Reasons for this impressive growth rate largely include diminishing growth hurdles for commodity exporters, recovering industrial activity, stabilizing commodity prices and improving consumer confidence. So, this is the right time to broaden your horizon and add a few stocks from these economies.

With the help of this strategy, you will be able to diversify and hedge your investment risk. These companies, mainly operating in their home countries, have the advantage of being influenced mainly by local economic growth.

You must be thinking that investing in foreign stocks is riskier than investing in domestic firms, owing to uncertainties related to currency devaluations, different business practices and lack of transparency. But an all-inclusive fundamental and economic analysis shows that some foreign stocks can be more rewarding now.

Picking the Attractive Stocks

To help you internationalize your portfolio, we have chosen foreign companies with the help of Zacks Stock Screener. We have selected foreign stocks that have market capitalization of $10 billion or more and carry a Zacks Rank #1 (Strong Buy) or #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

To further filter the list, we selected stocks with projected long-term earnings growth rate of 12% or more. Also, these winning stocks are based in emerging economies.

Here are the five stocks for your consideration:

CEMEX, S.A.B. de C.V. (NYSE:CX) sells cement, ready-mix concrete, aggregates and other construction materials world-wide.

Zacks Rank: #2
Home Country: Mexico
Market Cap: $12.4 billion
Long-term Growth Rate: 17.5%

Telefônica Brasil S.A. (NYSE:VIV) provides mobile and fixed line telecommunications services to residential and corporate customers in Brazil.

Zacks Rank: #2
Home Country: Brazil
Market Cap: $24.8 billion
Long-term Growth Rate: 13.9%

Shinhan Financial Group Co Ltd (NYSE:SHG) offers financial products and services in South Korea and internationally.

Zacks Rank: #2
Home Country: South Korea
Market Cap: $21.2 billion
Long-term Growth Rate: 18.4%

Huaneng Power International, Inc. (NYSE:HNP) an independent power producer, which generates and sells electricity to the regional or provincial grid companies in the People’s Republic of China and Singapore.

Zacks Rank: #2
Home Country: China
Market Cap: $11.9 billion
Long-term Growth Rate: 13.1%

Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF) , a franchise bottler, which produces, markets, distributes, and sells Coca-Cola trademark beverages.

Zacks Rank: #1
Home Country: Mexico
Market Cap: $16.9 billion
Long-term Growth Rate: 17%

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