The Dow Jones Industrials (DJINDICES: ^DJI ) are in many eyes the most quintessentially American stocks in the market, representing the cream of the crop of major U.S. companies. Yet as the global economy has become more interconnected, many of those companies haven't been content to be the biggest fish in their domestic pond and have instead gone out to seek their fortunes among international markets around the world.
Today, I want to look at the members of the Dow that get the highest proportions of their revenue from overseas. With so much of their sales coming from outside the U.S., the state of the global economy has a huge impact on their success, and their influence on the popular U.S. benchmark makes it clear just how much correlation there is among the major financial markets of the world.
Intel (NASDAQ: INTC ) , 84% of revenue from international markets
Chipmaker Intel has a truly diversified stream of revenue that comes from around the world. Taiwan marks its more concentrated source of revenue at roughly a third of its total sales, but it gets roughly equal contributions from the U.S., China, and Europe, with Japan and other Asia-Pacific areas boasting about 10% each of Intel's sales.
Where Intel stays close to home, though, is with its asset base. Fully 70% of its total assets are located within the U.S., although its asset presence in Israel has climbed in recent years. With its chips used in technology products around the world, Intel needs to keep up its geographically diversified sales base in order to maintain its competitive edge.
Caterpillar (NYSE: CAT ) , 70% of revenue from international markets
Machinery giant Caterpillar is willing to go wherever the growth is, and lately, most of that growth has come from foreign markets. The company has maintained a roughly two-to-one split in favor of international sales in recent years, and Caterpillar's purchase of Bucyrus didn't change that equation substantially.
Among its international operations, more than half of Caterpillar's property, plans, and equipment are in the U.S., with other facilities scattered around the world. The only country other than the U.S. with even a substantial fraction of Caterpillar's total assets is Japan, which nevertheless fell below the 10% mark in its most recently reported year.
McDonald's (NYSE: MCD ) , 68% of revenue from international markets
McDonald's fast-food chain is a truly global operation, with strong revenue in areas around the world. What's surprising to many is the fact that for years, Europe has been the stronghold for McDonald's, with well over half of the company's international revenue. Yet the Asia/Pacific region has been the hotbed for recent growth, with sales there nearly doubling between 2006 and 2011, compared with just 15% growth in U.S. revenue over that timeframe.
What's interesting, though, is that in terms of profitability, the U.S. is much stronger for McDonald's, with pre-tax operating margins 10 to 15 percentage points better than corresponding figures for Europe and Asia/Pacific. If the company can reverse that trend and boost margins where the best growth is, it could be huge for McDonald's overall results.
ExxonMobil (NYSE: XOM ) , 68% of revenue from international markets
Oil behemoth Exxon has followed the availability of energy resources around the world, tapping into opportunities wherever they can be found. Looking at Exxon's list of major revenue sources proves that, as the U.K., Canada, Japan, Singapore, and a number of European countries all come in with at least $14 billion in sales, while the company's catch-all brings in another $122 billion.
Unlike many other mature businesses, though, Exxon's U.S. revenue has been increasing as new finds at home have reawakened the domestic energy industry. If the U.S. truly does become the biggest energy producer in the decades to come, then Exxon will be in prime position to cash in.
Find growth wherever it is
With the U.S. economy having been sluggish for years even in a nominal recovery, looking abroad has been lucrative for many companies within the Dow. These four stocks have the potential to do extremely well if the global economy picks up steam -- even if it ends up leaving the U.S. behind.
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