The extraordinarily favorable conditions that the emerging markets enjoyed from 2009 to 2011 have started to vanish. It's no coincidence that commodities and equities in these economies underperformed the major indexes of developed markets, such as the S&P 500 and the DAX, since 2011.

And because Spanish companies have been strongly expanding internationally, focusing primarily on the emerging markets (especially Latin America), the current devaluation process in these economies is raising concerns among investors. We're talking about 74.8 billion euros in investments being exposed, so it's no joke.

Last Friday, the Argentine peso made its largest one-day drop against the dollar in more than a decade, while other emerging currencies like the Brazilian real, the Turkish lira, and the South African rand have also taken a hit. These corrections are likely to continue throughout this quarter, so be prepared.

Given the circumstances, let's see how these three Spanish ADRs are performing, given their exposure to the emerging markets.

At the mercy of Mexico
First, here's the second-largest bank in Spain and one of the largest banks in the world, Banco Bilbao Vizcaya Argentaria (BBVA 0.47%).

A key issue to consider when analyzing BBVA is that only one-third of its income comes from its home country; the rest comes from its ventures in other markets. The bank is highly exposed to Turkey, where it owns 25% of Garanti, the country's second-biggest bank. This week, HSBC downgraded the bank to neutral because of this factor. Mexico is an issue as well, as operations in the country accounted for 42% of the group's results in the first nine months of last year. Although the outlook is positive for Mexico, it could have a negative impact if the devaluation of its currency accelerates.

Back home, the situation is uneasy as well, as Spain's unemployment remains around 20% and there are still risks of high loan-loss levels until the country shows sustained improvements. Thus the bank might not be in a position to pay significant dividends in 2014, as the majority of European banks will continue retaining capital to stay well above minimum capital requirements and to deal with acknowledged problem assets on their books.

Better prepared?
Second, here's Spain's largest lender, Banco Santander SA (SAN -0.62%). This bank has a good record of profitable overseas expansion.

Santander is among the top banks in each of its markets in Latin America, so its exposure there is significant. Brazil accounted for 24% of attributable profits in the first nine months of 2013. Mexico brought in 11%, and Chile accounted for 6%. In fact, the whole of the continent is responsible for 49% of profits, so Santander investors must keep an eye on the region.

In addition, parts of Santander's regional positions in Latin America float in the local stock exchanges as Santander Brasil and Santander Mexico. Because financial institutions are often the first ones to make a correction in uncertain markets, Santander could experience a drop in its market capitalization as money flows out of these investments.

Nonetheless, this institution has historically shown outstanding aptitude for managing credit risk. It has overcome multiple crises.

Blowing up your telefono
Finally, here's the Spanish company with the greatest presence in Latin America, telecom giant Telefonica SA (TEF -0.22%).

Problems have faced Telefonica for quite some time already. In fact, it goes back to when it overpaid for Portugal Telecom's stake in Vivo, its Brazilian wireless operator. The debt taken on for this operation, along with the rise in Spanish interest rates as a consequence of the recession, restrained the company's operating flexibility.

But recently, the Latin American currency weakness started to add additional pressure to Telefonica's revenue struggles. The continent, which accounts for 48% of revenue, remains one of the best-performing regions for the company, with Brazil as the star. If a recession strikes the region, cash flow will be seriously compromised, and consequently, dividends will be reduced.

Final thoughts
The outlook is not very promising for the banks BBVA and Santander in the near term. Both are exposed to weaker business in their home country and abroad. Due to its track record, Santander might be in a better position to withstand the downturn, but its stock will still make a correction opening possibilities for longer-term positions.

Regarding Telefonica, the key will be to determine how deep the slowdown will be in the continent and how inelastic the demand for telecom's products is in the region. I suggest investors keep an eye on the company's sales levels.