After a turbulent 2018, emerging markets are finding favour amongst investors looking for value with strong upside potential.
This is on the back of a few major themes that should play out:
- A dovish FED that is expected to only hike rates once in 2019,
- EU monetary policy that will remain accommodative,
- Chinese stimulus to avoid a “hard landing”,
- Global growth to remain robust and
- Oil staying below $60 a barrel due to record production.
With investors licking their wounds from last year, the above should provide a tailwind for emerging markets. Investors should be targeting specific domestic shares that are leveraged for growth.
Domestic focused companies like Bidvest, Truworths, Capitec, Adcock, Growthpoint (Yield Play), KAP and AVI. Emerging market exposure, Naspers, ABinBev (potential spinoff), and Kumba.
Short Term Ideas
- Sasol: Buy below R430, target R460.00 (Longer term profit target in update below)
- Goldfields: Closed at target of R45.25 for 28.37% gain.
Long Term Ideas
- Sasol: Long term buy below R430. Target R550.
- AB InBev: Buy below R1,100 with a target of R1,500
- Richemont: Buy dips below R95. Target R130.00.
- Remgro: A break above R210 is needed to open up R230. Buy below R200.00
- Coronation: Sentiment still negative. Buy dips below R50.00 for a move back to R80
- Shoprite: Stuck in Trading range below R200. Hold.
- Aspen: Bottoming out. Add below R150.00, keep exposure appropriate.
- Sygnia: Moving in the right direction. Add below R8.
- MTN: Accumulate on dips below R80.
- Glencore: Buy below R52.50.
- Naspers: Break out imminent, buy below R3,000. Target R3,800
Investors looking to take advantage of the stronger Rand and gain offshore exposure with limited downside should contact us as new product launches close soon. Email firstname.lastname@example.org