We recently compiled a list of the 7 Best Emerging Markets Stocks To Buy Now. In this article, we are going to take a look at where Gold Fields Limited (NYSE:GFI) stands against the other emerging markets stocks.
According to the report, Emerging Markets: On the Cusp of a Renaissance published by Lazard Asset Management on October 28, emerging markets are home to 80% of the global population and are on the brink of significant growth, with nearly 2 billion people expected to integrate into their formal economies over the next decade.
Globalization has played a transformative role in improving education, employment, health, and wealth in these markets, creating a promising outlook for economic expansion and earnings growth. Economic and population growth are surging in emerging markets while stagnating or declining in developed economies. This divergence offers investors opportunities to diversify equity and fixed-income portfolios while mitigating risks. Over the past five years, significant outflows from emerging markets have created a fertile landscape for active investment strategies.
Central banks in emerging markets, particularly in Latin America and Eastern Europe, are leading the way in monetary policy innovation. Having raised interest rates during the global inflationary surge of 2021–2022, these regions are now easing rates ahead of their developed counterparts. This proactive approach, combined with the Federal Reserve’s anticipated easing cycle, is expected to bolster emerging market assets by stabilizing local currencies and supporting economic growth.
Read Also: 12 Best Stocks to Invest in for the Next 3 Months and Top 8 Stocks To Buy In 8 Different Sectors for the Next 3 Months.
Emerging markets are among the most undervalued and under-allocated asset classes globally. Despite positive underlying fundamentals, these markets are trading at significant discounts, offering investors a chance to access growth at favorable valuations. Moreover, global investors currently hold a disproportionately low allocation to emerging markets. A reversion to the 20-year average allocation of 8.4% would result in inflows of approximately $910 billion, equivalent to 58% of current assets under management. This influx of capital could serve as a catalyst for long-term appreciation.
As experienced active investors, Lazard Asset Management is focusing on identifying companies with enduring competitive advantages or those poised to develop them. The firm is confident that emerging markets are positioned to deliver strong growth and attractive returns, making them a vital component of any well-diversified investment portfolio. With that in context, let’s take a look at the 7 best emerging markets stocks to buy now.
Our Methodology
To come up with the 7 best emerging markets stocks to buy now, we have used Finviz and Yahoo Finance stock screeners to identify stocks of companies that are based in different emerging market countries. We then used Insider Monkey’s Hedge Fund database to rank the 7 stocks according to the largest number of hedge fund holders, which was taken from the database of 900 elite hedge funds as of Q3 of 2024. The list is sorted in ascending order of hedge fund sentiment, as of the third quarter.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Aerial view of a large gold mine in South Africa with many excavators and trucks working.
Gold Fields Limited (NYSE:GFI)
Number of Hedge Fund Holders: 22
Country: South Africa
Gold Fields Limited (NYSE:GFI) is a global gold-producing company that operates approximately nine mines spread across Australia, Canada, South Africa, Ghana, Chile, and Peru. The company is also involved in copper and silver and other related activities, including exploration, extraction, processing, and smelting. The company’s Windfall Project in Canada is recognized as one of the largest gold deposits in Canada and among the top 10 globally due to its high-grade gold content.
Gold Fields Limited (NYSE:GFI) is actively expanding its portfolio through strategic acquisitions to drive long-term growth. On October 28, the company announced the completion of its acquisition of Osisko Mining, a Canadian company focused exploration, and development of gold, silver, and diamond mines. The deal, valued at $1.57 billion in an all-cash transaction, will give Gold Fields Limited (NYSE:GFI) full control of the Windfall project in Quebec, Canada.
Despite the substantial investment, Gold Fields Limited (NYSE:GFI) has maintained a strong financial position and preserved its investment-grade credit rating. The company expects its financial position to strengthen further, driven by robust cash flow growth anticipated for the remainder of 2024 and into 2025 as production ramps up across several key operations.
Gold Fields CEO Mike Fraser highlighted the significance of the acquisition, emphasizing the exceptional quality and scale of the Windfall deposit. He described the transaction as a pivotal step in the company’s strategy to enhance the quality of its portfolio and secure long-term growth opportunities.
Overall GFI ranks 4th on our list of the best emerging markets stocks to buy now. While we acknowledge the potential of GFI as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than GFI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
