Looking To Score On Inventory Turnover? Try These 4 Brazilian Stocks

James Dennin, Kapitall: Despite displeasure with the US and political unrest at home, these Brazilian stocks have solid inventory turnover. 

Can you invest in Brazil? Should you even consider Brazilian stocks for your portfolio? It was certainly a popular choice a few years ago.

During America's dark days in 2009, investors were flocking to Brazil. Despite the ripple effects from American bank crashes, the Brazilian economy grew at a breakneck speed of 7.5%. Growth in the largest country in South America prompted analysts to coin the term BRIC, as an acronym for the four most important emerging economies: Brazil, Russia, India, and China. 

[Read more from Kapitall: US Soccer Sponsors Are World Cup Bound]

This prompted the country's voters to stay on course – electing the protég é of the very leader who presided over economic boom times. Unfortunately, things aren't going as well for Dilma Rousseff. Since taking over growth has lagged to less than one percent. This is partly due to falling commodity prices. But Brazil faces many other problems as well – it has some of the worst infrastructure in the world and a pension system that makes Detroit's look downright austere. 

On the flip side there are a number of reasons why may be too early to write off this economic giant.
  • Badly needed tax and legislation reform would help make the country more competitive for investment.
  • Brazil stands to become a major oil exporter in the years to come – and is already a giant in food exports.
  • The energy boom is helping to finance a growing local biotechnology industry.
  • And Brazil will host to both the Olympics and the World Cup in the next few years.

With that in mind we decided to run a screen on Brazilian stocks - value investors in particular may find the results interesting, as they tend to buy during downturns. President Rousseff may still be plagued by street protests and a chilly rapport with President Barack Obama. But a number of companies based in Brazil are still performing very well.

We looked at the inventory turnover among 30 Brazilian companies that trade on US exchanges. In particular we looked for stocks where inventory was decreasing as a total percentage of the company's assets. This means the company is selling its goods faster than expected – a potential indication of strong demand and future growth.

We were left with four companies on our list. 

Click on the interactive chart below to see data over time. 

<p>Your browser does not support iframes.</p>

Do you see investment opportunities among Brazilian stocks? Use the list below as a starting point for your own analysis. 

1. Braskem S.A. ( BAK): Produces and sells petrochemical products in Brazil and the United States. Market cap at $6.48B, most recent closing price at $16.28.

Revenue grew by 6.38% during the most recent quarter ($9,527.62M vs. $8,955.99M y/y). Inventory grew by -3.52% during the same time period ($4,374.02M vs. $4,533.69M y/y).

Inventory, as a percentage of current assets, decreased from 38.23% to 34.02% during the most recent quarter (comparing 3 months ending 2013-06-30 to 3 months ending 2012-06-30).
 

 

2. BRF – Brasil Foods S.A. ( BRFS): Produces and sells poultry, pork, beef cuts, milk, dairy products, and processed food products in Brazil and internationally. Market cap at $22.22B, most recent closing price at $25.54.

Revenue grew by 13.76% during the most recent quarter ($7,208.9M vs. $6,337.12M y/y). Inventory grew by 4.39% during the same time period ($3,191.74M vs. $3,057.5M y/y).

Inventory, as a percentage of current assets, decreased from 29.29% to 29.1% during the most recent quarter (comparing 3 months ending 2013-03-31 to 3 months ending 2012-03-31). 
 

 

3. Petroleo Brasileiro ( PBR): Engages in oil and natural gas exploration and production, refining, trade, and transportation businesses. Market cap at $103.57B, most recent closing price at $15.88.

Revenue grew by 2.63% during the most recent quarter ($35,569M vs. $34,659M y/y). Inventory grew by -5.94% during the same time period ($14,035M vs. $14,921M y/y).

Inventory, as a percentage of current assets, decreased from 25.93% to 21.49% during the most recent quarter (comparing 3 months ending 2013-06-30 to 3 months ending 2012-06-30).
 

 

4. Ultrapar Holdings Inc. ( UGP): Engages in the distribution of liquefied petroleum gas, and light fuel and lubricants. Market cap at $13.83B, most recent closing price at $25.89.

Revenue grew by 16.62% during the most recent quarter ($15,204.1M vs. $13,037.74M y/y). Inventory grew by 6.25% during the same time period ($1,396.59M vs. $1,314.42M y/y).

Inventory, as a percentage of current assets, decreased from 20.76% to 18.63% during the most recent quarter (comparing 3 months ending 2013-06-30 to 3 months ending 2012-06-30).

 

 

( List compiled by James Dennin, a Kapitall Writer. Analyst ratings sourced from Zacks Investment Research, accounting data sourced from Google Finance, all other data sourced from Finviz.)

null

If you liked this article you might like

Chipotle, Macquarie Infrastructure, DowDuPont: 'Mad Money' Lightning Round

Chipotle, Macquarie Infrastructure, DowDuPont: 'Mad Money' Lightning Round

15 Must-Have Stocks: Cramer's 'Mad Money' Recap (Monday 11/20/17)

15 Must-Have Stocks: Cramer's 'Mad Money' Recap (Monday 11/20/17)

3 Stocks Improving Performance Of The Chemicals Industry

3 Stocks Improving Performance Of The Chemicals Industry

Braskem (BAK) Flagged As Strong On High Volume

Braskem (BAK) Flagged As Strong On High Volume

3 Chemicals Stocks Driving The Industry Higher

3 Chemicals Stocks Driving The Industry Higher