The December retail sales report was a disaster, notes Landon Whaley, who recommends shorting the SP...
Diversify with Asian Tech
10/15/2015 9:00 am EST
By adding Asian tech to your portfolio of Silicon Valley stocks, you’re diversifying not just regionally, but in a host of other ways, too, explains Martin Hutchinson in Personal Finance.
Asia tech is different than Silicon Valley tech. Asian tech companies are more hardware-oriented, use more engineering, and are financed and managed on different principles that in many ways make them more stable.
Plus, since the recent meltdown of the Chinese stock market and surrounding markets, several of the companies we recommend here are on sale. Consider these stalwarts of Asian tech for your portfolio:
Yaskawa Electric (YASKY), founded in 1915, is a leading Japanese manufacturer of industrial robots and motion-control systems.
It is a typical Asian tech company that focuses on manufacturing and is highly stable, with a long-standing core of specialized engineers and massive intellectual property represented by patents worldwide.
It’s at the low end of its two-year price range, having peaked around $32 a share in December 2013. And its fortunes are on the rise: in its latest quarter, ended June 30, earnings per share rose 9% versus the same quarter last year.
LG Display (LPL) is a Korean company that dominates manufacturing of display screens, with over a 20% market share worldwide.
It’s also a leader in the cutting-edge technology of organic LED screens and makes the screen for the Apple Watch. Again, it is a massive holder of intellectual property, with more than 26,000 patents.
Trading at about $10.60 per share, LG Display is down from its 52-week high of $18.43, while financials are improving.
Its latest quarter (ended June 30)—versus the same quarter last year—showed improvements in sales, earnings (up 22.8%), and return on equity.
Japan’s Nintendo (NTDOY) is one of the three leading video-game-console manufacturers. It pioneered the Wii motion-sensitive game-control system, giving it an advantage over the PlayStation and X-Box.
Like Yaskawa and LG Display, it owns a large number of patents, most recently one for a system that monitors sleep quality.
Nintendo’s stock price has resisted the Asian contagion and currently trades around $24, about a buck below its 52-week high.
The company had a string of losses dating back to 2012, but it turned a profit in its most recent fiscal year, ended March 31.
It’s predicting its profits will double to $419 million in its 2016 fiscal year on sales of $4.77 billion, up from $4.6 billion for its 2015 year.
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