Monday, November 27, 2006

Play the Asian Boom

WASHINGTON, D.C. - Bad news for investors, at least for certain ones: The dollar will collapse against Asian currencies over the next two decades. Good news: China and India will evolve from devourers of basic materials into full-blown consumer economies, creating demand for U.S. exporters.

These are two of the premises behind stock picks from Stephen Fan, a money manager in Mountain View, Calif. with a fondness for midcap technology stocks. One in his portfolio is MEMC Electronic Materials, a St. Peters, Mo. firm (once part of Monsanto) that makes silicon wafers for the semiconductor industry. Last year sales outside the U.S. accounted for two-thirds of MEMC's $1.1 billion in revenues, with the bulk going to customers in Japan, Taiwan and South Korea. If Asia rockets as Fan expects, MEMC will likely go along for the ride. With shares at $35, MEMC goes for 5 times expected 2006 sales and 18 times expected earnings.

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