This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

3 Plays for Mexico's Surging Exports

The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

By David Sterman

NEW YORK (StreetAuthority) -- Every few weeks, another major manufacturer announces plans to shut down production in China and bring jobs closer to home. Some companies such as GE (GE) aim to boost production in the U.S. (GE will make hot water heaters in Kentucky, for example). That's because China is no longer the bargain it once was, thanks to a rising minimum wage and a strengthening currency. It's important for investors to be aware of this trend, because economists say it will only build in the years to come, as China's wages and currency are expected to rise even higher.

Perhaps the greatest beneficiary of this trend will be Mexico, which will always remain a low-cost environment for manufacturers. Since the North American Free Trade Agreement was ratified in 1994, Mexico has seen a steady rise in goods shipped north of the border. More than 70% of Mexico's exports head to the U.S., and that figure is expected to hit 75% in 2012. It's telling that even as global economies slumped in 2011, Mexico's exports still rose 13% to $336 billion, according to the CIA World Factbook.

Fairmont Pierre Marques

Follow TheStreet on Twitter and become a fan on Facebook.

Perhaps the clearest sign of increased economic activity can be seen in airport traffic. Aeroportuario del Sureste (ASR), which operates nine regional airports, recently announced that passenger traffic rose 10% in January from a year earlier. Business executives scoping out new manufacturing opportunities are likely part of that spike.

Rising exports are creating myriad benefits from Mexico. First, thousands of workers are finding jobs in factories each year, pushing them from subsistence living into the lower middle class. That boosts demand for all consumer-facing businesses. Second, the firms that transport goods are seeing a rise in business. Lastly, the government is able to secure rising tax receipts, crucial when you consider that government-owned energy giant Pemex is seeing falling output in key energy fields, leading to reduced remittances to the government.

These three investments are a great way to play the surging Mexican export sector.

1 of 4

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,086.63 -26.91 -0.16%
S&P 500 1,987.01 +3.48 0.18%
NASDAQ 4,473.6970 +17.6810 0.40%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs