New ADR Listing – BRMALLS Participacoes S.A.

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JP Morgan announced the launch of a new ADR from Brazil for BRMALLS Participacoes S.A. The ADR will be listed in the OTC market with ticker: BRMSY. “BRMALLS is an owner and operator of shopping centers in Brazil. They also provide management and consulting services for shopping, commercial and business centers as well as leasing and merchandising services for stores and common spaces in shopping centers”.

Details:
ADR effective date: December 24, 2008
Symbol: BRMSY
Traded: OTC
Ratio: 1 ADR: 2 Common Shares
Country of incorporation: Brazil
Industry: Real Estate

Profile:
“BRMALLS is the largest integrated shopping mall company in Brazil, with a portfolio of 34 malls, comprising 985.2 thousand m² of total GLA and 429.1 thousand m² of owned GLA with about 5.9 thousand stores and total sales of R$ 7.5 billion in 2007. Our average ownership interest in shopping malls is 43.4%. BRMALLS’ average ownership interest in each of the 34 shopping in its portfolio reflects the weighted average of its ownership interests in the individual shopping malls. Currently, BRMALLS has been developing 5 new shopping malls located in São Paulo state ( Mooca and Granja Vianna), Rio de Janeiro state ( Cabo Frio) and Minas Gerais (CBTU and Sete Lagoas), which will jointly add 149.4 thousand square meters of total GLA and 112.2 thousand square meters of owned GLA to our portfolio. BRMALLS has 11 expansion planned, which will add 73.4 thousand square meter of owned GLA to our portfolio by 2009.”

Corporate Site: www.brmalls.com.br

This company sounds interesting. Could not find a quote yet since it stated trading just yesterday. We will revisit this ADR next year.

A Comparison of OECD Countries

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The Organization for Economic Co-operation and Development (OECD) comprises of 30 countries “that accept the principles of representative democracy and free-market economy. Most OECD members are high-income economies with a high Human Development Index (HDI) and are regarded as developed countries.” (Source: Wikipedia).

The following are some interesting graphs from the “OECD in Figures 2008 – OECD Observer” published recently:

1.GDP Growth – Average Annual 1988-2007

OECD GDP Growth

Key Points:

  • Average Annual Economic Growth in the OECD countries for 20 years to 2007 was 2.8%
  • Korea and Ireland grew at the fastest at over 6.0% per year
  • Canada and USA were the only two countries that grew faster than other OECD countries

2.GDP Per Capita

OECD-GDP-Per-Capita

Key Points:

  • Tiny Luxembourg had the highest per capita at over $80,000 per year
  • Norways’s GDP Per Capita is higher than USA’s
  • Germany and UK have similar rates
  • Japan’s rate is slightly higher than the OECD Average which is surprising.

3.Public Debt (as a % of GDP)

OECD-Public-Debt

Key Points:

  • Public debt rose quite sharply since 1987
  • Italy’s debt exceeds 100% of its GDP
  • Countries that reduced their public debt – Australia, Belgium, Denmark, Ireland, The Netherlands, Spain and New Zealand

4. Healthcare Spending as a % of GDP

OECD-Health-Spending

Key Points:

  • Despite private industry dominance of the healthcare industry, US public spending on health care has risen from 1990-2005
  • The US spends the most on health care than any other OECD country

5. Road Fatalities – Killed per 100,000 population

OECD Road Fatalities

Key Points:

  • In 2006, Greece had the highest road fatalities rate. USA was the next one
  • Countries like Sweden, Norway, Japan have the lowest fatality rates

The World’s Ten Most Influential Companies

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The December 22nd edition of BusinessWeek published an article titled “The World’s Most Influential Companies”. As per BusinessWeek, “they are the innovators and front-runners that are shaping business today”.

The following is a brief overview of the the top ten companies from the list. These 10 companies “have devised winning strategies in their industries. They are the ones with the game-changing ideas, the greatest impact on consumers, and the bold tactics rivals emulate. None is infallible or without controversy”. Five of the 10 companies are US-based.

1. Apple (AAPL) is a Cupertino, California-based maker of many technology products like cool laptops, iPhones, iPods, etc.that are “imaginative, irreverent, and pleasing to the eye”. Apple’s annual sales is $24.0 B. AAPL does not pay a dividend. After reaching a high of $200 in January, the stock closed for $85.04 today. Annual revenue growth in the past 5 years is 39.23%. However sales may not continue at this pace due to the economy being in recession and many folks who own iPods, iPhones do not find the need to replace
them.

2.Google (GOOG) is the world’s top search engine. It processes “3,000 queries per second in the U.S. alone”. GOOG has a P/E of 19.07 and does not pay a dividend. Late last year the stock reached a peak of $716. Today it closed at $302.95.

3.Huawei is a Shenzen,China-based maker of “networking equipment, cellular handsets, and other telecommunications gear. Huawei’s stock is not listed in the US markets. The company competes against other network equipment makers like Nortel, Alcatel-Lucent, Cisco,etc. Annual sales is $12.6 billion.

4.JPMorgan Chase and Co (JPM) is one of the so called three giant “superbanks” that dominate the financial industry in the USA. JPM currently pays a dividend of 5.22%. In September,Chase bought the failed West Coast bank Washington Mutual (WaMu).

5. St. Louis-based Monsanto(MON) is “a global provider of agricultural products for farmers”. BusinessWeek says “About 97% of U.S. soy is now grown using Monsanto technology, and the company’s insect- and herbicide-resistant corn and cotton have become the default standard for U.S. farmers”. The current yield is 1.45%.

6.News Corp(NWS) is is one of the world’s largest media conglomerates. In the US, News Corp. owns many newspapers such as The Wall Street Journal, New York Post and the Fox TV news channel. NWS pays a dividend of 1.36%.

7.The oil company Saudi Aramco is based in Dhahran, Saudi Arabia. Annual sales is $210 B. As the world’s largest oil producer it “ships around 8 million barrels to industrial powers” everyday. Saudi Aramco does not trade in the USA.

8. Toyota Motor Corp (TM) is one of the world’s largest auto makers. TM’s current yield is 4.8%. While revenue increased annually about 11% in the past 5 years, this week Toyota announced that auto sales plunged 21.8% in November, the biggest in 8 years and projected that it will report its first operating loss in 70 years due to the current slowdown in the global economy.

9.Unilever PLC (UL) is one of the parent companies of the Unilever Group (Unilever) with headquarters in London, UK. Unilever owns brands such as Dove, Lipton, Vaseline, etc. and they are popular in many emerging countries like India,Brazil. Unilever was successful in marketing its products to the poor consumers by making the packages very small and set the price accordingly. The P/E is 9.48 and the yield is 2.91%.

10. Wal-Mart Stores Inc (WMT) is the world’s largest retailer. The company operates the Wal-Mart Stores and Sam’s Club in the USA. Sam’s club’s sales accounted for 11.8% of total net sales in 2008. About 100 million Americans visit its stores each week. WMT pays a dividend of 1.72%.

Cleantech Stocks for 2009

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Green energy companies operate in the renewable energy space. Companies that manufacture solar panels, wind turbines, ethanol etc. fall in this category. After rising to astronomical levels in 2007, green energy stocks fell heavily this year. However in the long-run some of these companies will be successful as the demand for green energy products increase when the President-Elect Obama takes office.

In the latest issue of BusinessWeek, an article titled “How to bet on CleanTech” lists four stocks. A brief overview of these stocks:

1.ABB Ltd (ABB) is a Swiss-based “global provider of power and automation technologies to utility and industry customers”. ABB makes “a broad range of products, systems and services for power transmission, distribution and power plant automation.” The current yield 3.43% and the P/E is 7.74. After reaching a low of about $9 in October, it now sells for $13.79 a share.

2. First Solar Inc (FSLR) “designs and manufactures solar modules using a thin film semiconductor technology. Its solar modules employ a thin layer of cadmium telluride semiconductor material to convert sunlight into electricity. It has long-term solar module supply contracts (the Long Term Supply Contracts) with 12 European project developers and system integrators.” This is a high beta stock and the P/E is also high at 41.05. FSLR pays no dividend. Total revenue last year was $1.0B.

3.Spain-based Ibedrola Renovables SA (IBDRY) is the world’s largest wind power company. It “is a multinational company, operating in 20 countries including nine of the ten world markets with the greatest growth and development potential in this sector. The Company, one of the leading firms in stock value of the Ibex-35, has become the fastest growing element of the IBERDROLA Group”. IBDRY trades on the OTC market and pays a dividend of 5.82%.

4.Verenium (VRNM) trades on the Nasdaq. It “Failed to Meet NASDAQ Continued Listing Requirements”. Currently sells for $0.74 a share. This is a highly speculative play.

Brazilian Utilities with More Than 5% Yields

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The following Telecom and Utility ADR stocks of Brazil offer dividend yields of more than 5%. It should be noted however some of these companies do not pay dividends consistently.
1.Brasil Telecom Participacoes S/A (BRP) is a telecom provider with headquarters in Brasilia. The current yield is 7.36% and the P/E ratio is 14.04. Year-to-date the stock is down about 41%. In October BRP reported that its net revenue grew by 3.4% over last year.

2. Brasil Telecom S.A. (BTM) has a dividend yield 6.98%. Year-to-date the stock is down about 35%. On Dec 18, the Oi acquisition of BTM was approved.

3.The electricy utility CPFL Energia S.A. (CPL) pays a dividend of 9.40%.Year-to-date the stock is down about 21%. Annual revenue growth in the past 5 years is 12%.

4.Telecomunicacoes de Sao Paulo S/A-Telesp (TSP) is a fixed-line telecommunication services provider in the State of Sao Paulo. About 77% of its customers are residential users. The current yield is 6.73%. Annual dividend growth in the last 5 years is 25.25%.

5. TIM Participacoes SA (TSU) is wireless provider in Brazil. Annual revenue growth in the last 5 years is 69.21%. The current dividend yield is 5.82%.

Note: All data is as of market close Dec 19, 2008.