These Stocks Beat Mexican Stocks

On some market days, news headlines are dominated by individual stocks whose shares have soared over the past year. Other times, statistics show how an entire group of stocks -- from a country, sector, or industry -- have outpaced the general market.

Mexican stocks are on the top of many investors' lists lately, with a growing economy and several large companies astutely tapping international markets for spectacular growth.

But I can tell you tales of companies from another region beating the pants off Mexican stocks ... and where you can find out more about them.

Would the real hot stocks please come forward?
By using Motley Fool CAPS, investors can get detailed information and community intelligence on not only individual stocks, but entire sectors, regions, or industries.

Any of the 5,200 rated stocks that are profiled in CAPS can be "tagged" with a descriptor that groups the company with others that share a certain quality, such as a country of origin, sector, or industry. A click on the "Mexico" tag pulls up a list of 24 stocks that as a group have posted solid returns of 17.1% in the past year.

But another country has doubled the returns of the Mexican group -- Chile. The one-year return of the 14 companies highlighted in this tag is a healthy 34.4%. Of course, this doesn't necessarily mean that investors should ignore Mexico and pile into Chile -- there may be great opportunities in each. Thankfully, CAPS can help us dig under the surface here, too.

From macro to micro
Tag groups can quickly be sorted by their CAPS rating, denoted by one to five stars, with five being the best. Individual companies can also be viewed to show details of just who -- from Wall Street to Main Street -- is bullish or bearish on the company and why. For instance, here's a few stocks in the Mexico group and their individual performance in the past year.

Company

CAPS Rating (out of 5)

One-Year Performance

America Movil (NYSE:AMX)

*****

37.6%

Cemex (NYSE:CX)

*****

(18.4%)

Grupo Simec

***

(50.2%)

Grupo Aeroportuario del Pacifico (NYSE:PAC)

****

25.0%

Performance numbers as of Nov. 16.

Similarly, here's a sampling of Chile-tagged stocks that -- judging by interest in the CAPS community -- investors may want to consider:

Company

CAPS Rating

One-Year Performance

Chemical & Mining Co. of Chile (NYSE:SQM)

*****

35.1%

LAN Airlines (NYSE:LFL)

***

41.2%

A. F. P. Provida (NYSE:PVD)

*****

49.9%

Banco Santander-Chile

***

(8.7%)

Performance numbers as of Nov. 16.

One reason some stocks in Chile are outperforming global peers is that they tend to be smaller and less widely followed. This sometimes leaves stocks such as A.F.P. Provida, an administrator of private pension funds, valued down in the basement. An earnings multiple below 9 and a dividend yield of 5.2% are reasons that not long ago, A.F.P. Provida was rated as South America's best stock in the CAPS community.

There's lots of CAPS "smart money" bullish on the stock as well -- 58 out of the 103 who rate the company are All-Star investors with a rank above 80. And all of these top stock pickers believe A.F.P. Provida will beat the S&P going forward.

Raw materials companies have also been a huge hit with investors, thanks to global demand for infrastructure in emerging economies. Chemical & Mining Co. of Chile mines and produces a range of fertilizers and other products, such as lithium compounds used in batteries and air conditioners. Like rocketing U.S. counterpart Terra Nitrogen (NYSE: TNH  ) , CAPS investors believe the company will be a big winner from the wave of demand for nitrogen-based materials and lithium batteries. Indeed, a unanimous 109 CAPS investors give the company the thumbs-up to beat the market.

Before you buy ...
Of course, investors don't want to be looking in the rearview mirror to find out where they should be investing now. But the underlying reasons behind dramatic runups in stocks or groups of stocks can help investors better understand macroeconomic trends that may significantly affect investments. No matter where investing ideas come from, investors should always perform their own due diligence and not follow crowds or individual recommendations. 

Another resource for finding little-known gems in foreign markets is the Motley Fool Global Gains service. Lead analyst Bill Mann and his team are heading to South America to look for investing opportunities. If you'd like to receive their updates and company discussions as they travel, simply provide your email address in the field below. 


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