Time to Rethink the Role of Emerging Market Bonds
Investors are stepping back into emerging market bonds after removing billions of dollars from emerging markets in 2016.
Strong investor interest in emerging market debt has continued despite adverse political and economic issues in some countries.
According to a recent BofA Merrill Lynch Global Investment strategy report, emerging markets are expected to grow at a modest pace of 4.7% in 2017.
Negative bond yields in Japan and low Fed funds rates in the United States and the Eurozone were one reason emerging market bonds performed well in 2016.
On January 17, 2017, Huntsman (HUN) announced the name of its proposed spin-off for its pigments and additives business. It will be called Venator Materials Corporation.
On January 17, 2017, RPM International (RPM) announced that it has acquired Prime Resins. The acquisition will be integrated into RPM’s USL Group.
On January 17, 2017, International Flavors & Fragrances (IFF) announced that it has completed the acquisition of Fragrance Resources. IFF stock rose 1.3% for the week ended January 20, 2017.
As of January 11, 2017, DuPont traded at a one-year forward PE multiple of 20.00x compared to its peers Dow Chemical (DOW) and LyondellBasell (LYB).
Analysts’ consensus indicates a 12-month target price for DuPont at $78.10—a return potential of 5.5% from its closing price of $74.03 on January 11.
DuPont (DD) offers defined benefit plans to 80% of its employees across the world along with other long-term employee benefits.
DuPont’s (DD) stock price remained flat with a marginal gain of 0.6% from December 1, 2016, to January 11, 2017. DuPont has been trading sideways.
On January 3, DePuy Synthes, a subsidiary of Johnson & Johnson (JNJ), entered into an asset purchase and development agreement with Interventional Spine.
On January 10, 2017, 18 brokerage companies were actively tracking 3M Company’s (MMM) stock. Among them, 44% of analysts recommended “buys” on the stock.
Currently, MMM is trading at a premium compared to HON and UTX. All three companies’ revenues have remained range-bound in the past three years.
3M (MMM) offers defined benefit plans to all its US employees and those outside the United States as a well. Overall, the company has 80 defined plans across 28 countries.
3M Company’s (MMM) stock rose 3.2% from the beginning of December 2016 to January 9, 2017. MMM’s stock is hovering near its 52-week high.
As of January 6, 2017, 22 brokerage firms were actively tracking Honeywell (HON) stock. 82% of these analysts recommended a “buy” for the stock.
As of January 6, 2017, HON was trading at a one-year forward PE multiple of 16.5x as compared to its peer United Technologies (UTX), which is trading at a one-year forward PE multiple of 17.2x.
Honeywell (HON) offers defined benefit plans that cover the majority of its employees and retirees in the United States and many other countries.
Honeywell (HON) stock rose 1.7% in December 2016. The company’s stock performance in December was muted compared to November’s returns of 3.9%.