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.