In September, U.S. consumer confidence slumped to a seven-month low due to the continued resurgence of COVID-19 cases and concerns surrounding high inflation. In addition, Federal Reserve Chairman Jerome Powell expressed worries over inflation and said that the central bank could soon reduce its large-scale purchases of government-backed bonds. The Fed also indicated that it might raise interest rates in 2022.
Considering the domestic market volatility and economic uncertainty, international stocks with solid growth attributes could be wise bets now. According to an OECD report, the global economic recovery remains strong, helped by government and central bank support and progress in vaccination.
So, it could be wise to diversify your portfolio by adding a few high-quality international growth stocks such as Weibo Corporation (WB), Shoprite Holdings Limited (SRGHY), and Fuwei Films (Holdings) Co., Ltd. (FFHL). They have solid growth attributes and are expected to continue gaining in the near term.
Weibo Corporation (WB)
Headquartered in Beijing, China, WB operates as a social media platform to create, distribute, and discover content. It operates in two segments: Advertising and Marketing Services; and Value-Added Services. It also provides advertising and marketing solutions.
On August 18, Gaofei Wang, WB’s CEO, said, “On the user front, both our MAUs and DAUs reached a record high in June, leveraging our further enhanced competitiveness in social products, initiatives on the video front and effective channel investment. On monetization, the strong momentum of our ad business was underpinned by our relentless effort to optimize ad products and improve efficiency to drive value for our customers."
WB’s net revenues surged 48% year-over-year to $574.50 million in the fiscal second quarter ended June 30, 2021. The company’s non-GAAP income from operations grew 83% year-over-year to $223.20 million, while its non-GAAP net income came in at $182.80 million, representing a 59.6% year-over-year increase. Also, its non-GAAP EPS came in at $0.79, up 58% year-over-year. Its revenue and EBITDA increased at CAGRs of 10.9% and 7.7%, respectively, over the past three years.
Analysts expect WB’s EPS to increase 27.3% year-over-year to $0.84 for the quarter ending September 30, 2021. In addition, it surpassed Street EPS estimates in each of the trailing four quarters. The company’s revenue is expected to increase 31.6% year-over-year to $2.22 billion in fiscal 2021. The stock soared 30.4% over the past year to close yesterday’s trading session at $47.49.
It’s no surprise that WB has an overall B rating, which equates to a Buy in our POWR Ratings system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
Shoprite Holdings Limited (SRGHY)
Based in Brackenfell, South Africa, SRGHY is an investment holding company primarily engaged in food retailing. The company operates through four segments: Supermarkets RSA; Supermarkets Non-RSA; Furniture; and Other Operating segments. It also offers clothing, general merchandise, cosmetic, and liquor products.
SRGHY's Money Market Account launched instant EFT payments on August 23. Jean Olivier, General Manager for Financial Services at SRGHY, said, “This is another rapid response from Shoprite to a real problem facing citizens on the ground - and we’re pleased that it will remain as a key product in the growing suite of services offered by the Money Market Account. It goes to show how much we can achieve in a short amount of time when the circumstances require it.”
SRGHY’s sale of merchandise surged 48% year-over-year to R168.03 billion ($11.11 billion) in the fiscal year ended July 4, 2021. The company’s operating profit grew 19% year-over-year to R9.66 billion ($638.78 million), while its profit came in at R4.86 billion ($321.37 million), representing a 43.9% year-over-year increase. Also, its adjusted EPS came in at 883.8 cents, up 20.7% year-over-year. Over the past three years, its revenue and EBITDA increased at CAGRs of 5% and 10.6%, respectively.
SRGHY’s revenue is expected to increase 6.7% year-over-year to $12.56 billion in the next year. Over the past year, the stock has soared 42.1% to close yesterday’s trading session at $11.94.
SRGHY’s POWR Ratings reflect this promising outlook. The company has an overall rating of B, which translates to Buy in our proprietary rating system. The stock has a B grade for Growth, Stability, and Quality.
Fuwei Films (Holdings) Co., Ltd. (FFHL)
Headquartered in Weifang, the People's Republic of China, FFHL develops, manufactures, and distributes biaxially oriented polyethylene-terephthalate films. The company offers dry film, chemically treated films, stamping foil base films, transfer base films, and printing base films.
On September 3, Mr. Lei Yan, FFHL’s Chairman and CEO, said, “We believe these results benefit from our commitment to innovation and differentiated marketing strategy, which have expanded the end-user applications of our films products. We will carry on with these efforts and expect that they will enable the Company to capitalize on new opportunities despite challenging industry and economic conditions.”
FFHL’s net revenues surged 21.4% year-over-year to $15.6 million in the fiscal second quarter ended June 30, 2021. The company’s total liabilities decreased 54.3% year-over-year to $15.40 million, while its net income came in at $3.07 million, representing a 40.9% year-over-year increase. Also, its EPS came in at $0.94, up 40.9% year-over-year. Its revenue and EBITDA increased at CAGRs of 6.4% and 95.2%, respectively, over the past three years. The stock has soared 154% over the past year to close yesterday’s trading session at $9.50.
FFHL’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall A rating, which equates to a Strong Buy in our proprietary rating system.
In addition, it has an A grade for Value and Growth, and a B grade for Momentum and Quality. Click here to access FFHL’s ratings for Stability and Sentiment as well. FFHL is ranked #1 in the China industry.
WB shares were unchanged in after-hours trading Friday. Year-to-date, WB has gained 12.56%, versus a 17.28% rise in the benchmark S&P 500 index during the same period.
About the Author: Nimesh Jaiswal
Nimesh Jaiswal's fervent interest in analyzing and interpreting financial data led him to a career as a financial analyst and journalist. The importance of financial statements in driving a stock’s price is the key approach that he follows while advising investors in his articles.3 International Growth Stocks With Even More Upside appeared first on StockNews.com