Jim O’Neill, the man who invented the BRIC investment category, now says that the consumer sector in Brazil, Russia, India and China represents the “key investment of our lifetime.”
After trading sideways this year, Russian stocks have exploded into a 9% rally in the last three weeks. The factors driving Moscow back into the bullish camp were in focus in today’s Trading the Globe.
Tone continues to be very positive as large-cap laggards join the party. Multinational companies are moving deep into emerging markets, as the WBD-PEP deal shows. Watch Treasury yields in the context of tomorrow’s U.S. job numbers.
Wimm-Bill-Dann was punished yesterday on some pretty huge volume. Is this a good opportunity to buy a great company on the cheap, or should traders steer clear even at these levels?
Oil is the heart of the modern Russian economy, but portfolios that reflect this bias also expose investors to boom-and-bust volatility.
Russian dairy giant Wimm-Bill-Dann held up relatively well through the summer grain crunch. If anything, consumer demand for milk and yogurt is getting better than ever.
WBD (quote) says it had trouble finding enough raw milk last quarter to keep its profit margins intact amid the worst drought in decades.
However, much of the bad news had already been baked into the stock.
In fact, WBD still reported a decent operating profit of $375 million over the first half of the year on revenue of $1.2 billion, which reveals a margin slightly (0.60%) better than analysts had expected.
And revenue surged 17% as Russian domestic demand for dairy products and baby food is, in the CEO’s words, “back to levels we have not seen since before the global economic crisis.”
This is a decent story that will get better. Meanwhile, it will be close to two years until an integrated Unimilk-Danone (DANOY, quote) becomes a real threat in the baby food arena.