Wednesday, January 28, 2009

Brazil's Golden Stocks

In recent years the Brazilian economy has accelerated to all-time levels.  Brazil is the largest country in South America and dominates the market on the countininet.  It has grown to become the ninth-largest economy in the world which is impressive after all the years of economic hardship the country has faced.  Brazil now is emerging intot he international scene as its mining, agriculutral, service, and manufacturing sectors expand.  After recording a record growth of 4.5% in 2007 experts expect similar numbers in 2009.  Brazil did face a set back in 2008, but so did the rest of the world's economies.  Currently the economy has shown no signs that it will slow down as they are dumping billions of dollars into resources to expand the country's economy. As a result the Brazilian econpmy offers great opportunities for investment and here are the Golden Stocks of Brazil.

1.  Monsanto (MON)  This Brazilian agricultural giant has slipped in recent times but has announced higher guidance for 2009 that suggest the company will go back to its rapid growth which was seen before the credit crunch.  In January of 2008 this company reported earnings increases of 188%.  Expect similar numbers in 2009 as fertilizer makers begin to surge due to the growth in Agricultural herbicides and Corn seeds sales in Brazil.  Monsanto currently produces corn and other seeds while developing biotech traits to integrate into the seed.  These traits will help farmers lower risk from potential famine and should be a hot commodity.
2.  Petroleo Brasileiro SA (PBR) Brazil government-controlled oil company said just reported that loans of $30 billion will help the company's spending plan this year aimed at developing the Americas' largest discovery in three decades.  This loan is part of a $175 billion strategy for 2009 through 2013 the company has proposed to increase production.  Latin America's biggest Public-Traded company is booming and increasing investments while rivals such as ConocoPhillips are downsizing.  The company plans on increasing 10 times the production levels by 2020.  With such support from Latin American Governments PetroBras could soar to the top oil company worldwide.  As of right now it is a full on buy with the confidence it has shown in such times.
3.  Companhia Vale Do Rio Doce (RIO) Read article below "RIO's Booming Comeback"
4.  Unibanco (UBB) Brazil's largest bank, it does a great job at increasing employee productivity whilst keeping costs down and providing Financial services to individual and corporate customers.  Like most emerging stocks expect volatile daily ranges especially within Brazilian financials.
5.  Banco Bradesco (BBD) BBD is the second largest private bank in Brazil which offers financial services and banking both locally and internationally.  It currently works with individuals, small to mid-sized companies, corporations, and institutions.  BBD is less volatile than UBB.
6. IShares MSCI Brazil Index (EWZ)  A strong Exchange Traded Fund based around Brazilian companies.  If you are interested in all the Brazilian Gold stocks then this is the play for you.  It currently holds all the companies mentioned above along with some other interesting Brazilian plays.  Currently trading in the mid $30s it is a steal as it was trading in $100s back in May.  As Brazil rebounds so will EWZ and it will be an opportunity you cannot miss.

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