Over Valued markets vs. Overlooked Frontier Markets

VALUEPICK · 1 Over Valued markets vs. Overlooked Frontier Markets Mon Feb 06, 2017 1:46 am

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Frontier markets are one of bright spots in the world map for 2017 as they have rich valuation compare with other markets. Some attractive growth and value stocks in Sri-Lankan market also should get limelight from some intelligent market participants sooner than later. As an asset class overlooked frontier markets stocks have more room to appreciate as other markets have extended quite lot. Particularly both value and growth stocks will become winners provided they buy businesses not stocks. Every country has some specific growth areas as well as efficient and effective managers.

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Experienced stock pickers will go for values and portfolio diversification in these markets. They will take advantage of crowd behaviour as well.

Type of stocks available in the overlooked CSE

Fundamentally sound value stocks: there are companies even if they have half of the current earnings still their forward P/E will be below 10 or 8.

There are companies fundamentally weak while having terrible financial ratios and balance sheets: Turnaround companies will be biggest winners in this category and some will take some time to repair their balance sheets.

Growth stocks

Momentum stocks

Debt free companies

Debt free and cash rich companies

Dividend oriented companies

Positive outlook companies

Negative out look companies

There are companies can have at least short term rally time to time due to seasonal above average earnings

Effective and efficient mangers will run some of the listed companies by looking for new opportunities, by having cost cutting strategies and by having better cash flow management etc. In other words by managing well. They will create shareholder value etc. Future earnings, strong balance sheets and positive cash flow will drive future share prices. Once bull market set even negative factors will ignore. In a weak market even positive factors will ignore.

Be bullish when others become bearish!

Be bearish when others become bullish!

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http://www.cnbc.com/2016/08/08/markets-why-the-sell-everything-crowd-has-been-really-wrong.html

Markets: Why the 'sell everything' crowd has been really wrong

https://www.bloomberg.com/view/articles/2015-07-07/the-wisdom-of-crowds-is-not-that-wise

The 'Wisdom of Crowds' Is Not That Wise

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Companies with positive stories in frontier markets such as Sri-Lanka will reward the specialist.

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Over Valued markets vs. Overlooked Frontier Markets

1 Over Valued markets vs. Overlooked Frontier Markets Mon Feb 06, 2017 1:46 am

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2 Re: Over Valued markets vs. Overlooked Frontier Markets Mon Feb 06, 2017 4:16 am

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3 Re: Over Valued markets vs. Overlooked Frontier Markets Mon Feb 06, 2017 4:21 am

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4 Re: Over Valued markets vs. Overlooked Frontier Markets Mon Feb 06, 2017 5:23 am

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