Emerging Market ADRs: Winners and Losers

NEW YORK (Thestreet) -- Among emerging markets' indices, except the Shanghai Composite Index, which notched up 4.5%, India's Nifty and Brazil's Bovespa erased 1.7% and 2.1%, respectively, last week. Meanwhile, as U.S. jobless claims dropped more than expected, the Dow Jones and the S&P 500 closed 2.3% and 2.7% higher, respectively.

China: Winners and Losers

Changyou.com ( CYOU) topped the advancers' list, up 19.6%, after reporting an impressive fourth quarter. Net income for the quarter increased 23% year-over-year to $47.8 million, while revenue was up 30% to $91.7 million. Sohu.com ( SOHU) rose 16.1% past week.

Jinpan International ( JST) climbed 13.1% last week after the company secured five large domestic orders in January. The orders, scheduled for delivery between March and June 2011, are worth a total $6 million. Qiao Xing Universal Resources ( XING) advanced 13%. Past week, analysts at Trading Markets said Xing is an attractive buy as it is a small-cap stock with a strong cash position relative to its total assets.

Sina ( SINA) and AsiaInfo-Linkage ( ASIA) were up 12.9% and 12.8%, respectively. Recent industry reports said Nokia ( NOK) is collaborating Sina and Tencent to integrate Ovi Maps into local social networks during the first quarter of 2011. Sina's Weibo will be providing Nokia with instant access to the 100 million internet users that it is likely touch by the second quarter of 2011. Meanwhile, AsiaInfo is on a winning streak after reporting strong fourth quarter earnings.

Baidu.com ( BIDU) climbed 10.5% last week. China's top search engine reported a more than twice increase in its fourth quarter net profit to $175.9 million, compared to the same period last year. Baidu's revenue surged 94.4% to $371.3 million. Additionally, during the quarter, the company's active advertisers soared by 24%, adding 4,000 new subscribers.

Xinhua Sports & Entertainment ( XSELD) headed the losers' list, plunging 93.3%. Last week, global food prices touched record highs on uncertain weather conditions and a tight supply scenario. Food stocks like Feihe International ( ADY) and New Dragon Asia ( NWD) shed 12.6% and 11.8%, respectively.

Other notable losers were China Skyone Medical ( CSKI) and China Biotics ( CHBT), down 8.3% and 5.8%, respectively.

India: Winners and Losers

iGATE ( IGTE) emerged top gainer last week, up 13.5%. Analysts at Zacks Investment Research recommend buying this stock cheap as they expect it to generate huge returns in the foreseeable future. Syntel ( SYNT) followed, advancing 7.1%. Last week the company announced plans to start a new, 25-acre manufacturing facility at ELCOT IT Park in India.

WNS Holdings ( WNS) rose 5.7% after Goldman listed the stock in the "greater than 30% probability in merger and acquisition activity in the upcoming 12 months." Cognizant Technologies ( CTSH) gained 5.3% after JPMorgan reaffirmed its overweight rating on the stock with a price target of $92, implying a 22% upside from current levels. An S&P 500 analyst raised the stock's fourth quarter earnings per share estimate to 69 cents from the earlier forecast 67 cents. Cognizant is scheduled to release its earnings on Feb. 07, 2011.

Sterlite Industries ( SLT) and Rediff.com ( REDF) were up 3% each last week. Sterlite recently completed the acquisition of a 74% stake in Black Mountain Mines in South Africa from one of the operations of Anglo American for $260 million. EVA Dimensions has upgraded the stock to buy from hold.

Mahanagar Telephone Nigam ( MTE) topped the losers' list last week, declining 4.2% after hitting 52-week lows on Feb. 4, 2011. The company will release its third quarter results on Feb. 11, 2011.

Dr. Reddy's Laboratories ( RDY) followed, losing 2.1%. A U.S. federal court recently approved the company's proposal to market the generic version of its allergy drug - Sanofi-Aventis and Allegra-D 24. ICICI Bank ( IBN) trailed, edging 0.5% lower last week. Individual and corporate loans have become costlier after the fresh round of interest rate hikes by Indian banks. On a more positive note, ICICI Bank recently signed a memorandum of understanding with the Indian army to provide various banking services, designed to meet the needs of army personnel.

Brazil: Winners and Losers

Petroleo Brasileiro (Petrobras) ( PBR) headed the advancers' list, increasing 7.4% during the past week. The company recently restarted oil production at its Campos Basin platform, which was closed earlier in January, following a fire breakout. Petrobras has unveiled plans to invest almost $4.5 billion in research and development, spread over the upcoming five years, focusing on advancing technologies for ultra-deepwater oil production.

Gerdau ( GGB) came next in the gainers' list, rising 6.8% after the announcing to buy back almost $3.1 million preferred shares. The stock price increase was cushioned further as prices of scrap steel touched 52-week highs last week. Companhia Siderurgica Nacional ( SID), another steel manufacturer, rose 2.5% last week. The company recently disclosed that it has contracted a $1.19 billion loan through the issuance of bank credit from state-run bank Caixa Economica Federal, without specifying the purpose of the loan. The amortization period of the loan is 94 months.

Brasil Foods ( BRFS) gained 1.7% last week, after receiving target prices updates from research houses. HSBC and JPMorgan reaffirmed their overweight rating on the stock, increasing the price target to $22 and $19, respectively, from the earlier target of $17.5 and $17, respectively.

Centrais Eletricas Brasileiras (Eletrobras) ( EBR) and Embraer ( ERJ) were up 1.6% each during the past week. Last week, Embraer signed a deal to sell 10 Embraer 190 planes to a Ukraine-based airline for $400 million. Of the total, the first two planes are scheduled for delivery during the first quarter of 2011. The deal, which has an attached option of delivering five more planes of the same model, may reach $600 million if the option is exercised.

TAM ( TAM) was among the major losers last week, dipped 8.6% after volumes narrowed 59.9%. Another airline stock, Gol Linhas Aereas Inteligentes ( GOL), slipped 5.7% after BlackRock reduced its stake in the company on behalf of some of its clients.

Last week, two Brazilian banks - Banco Bradesco ( BBD) and Banco Itau Holding Financeira ( ITUB) - expressed interest in acquiring a 49% stake in the local financial branch of Carrefour. In fact, Bradesco has also offered the highest proposal of $598 million for the stake. These two banks shed 5.5% and 4.4%, respectively, during the past week.

Tele Norte Leste Participacoes ( TNE) and Gafisa ( GFA) lost 4% each. The Sao Paulo state government, meanwhile, said it plans to reduce taxes on building materials to stimulate low-income housing construction activity. The government has also raised the maximum loan amount to $101,405 for this housing program.

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

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