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Two Ways to Invest in Legal Immigration
11/18/2019 5:00 am EST
Without getting embroiled in the pros vs. cons of immigration, it makes sense to look at it from a business point of view — and focus on the investing opportunities that have emerged from the influx of immigrants into the U.S., notes Nancy Zambell, editor of Cabot Wealth Network.
One such idea is New Oriental Education & Technology Group Inc. (EDU). It’s a Chinese-based company that specializes in language training and test preparation courses. More than 6% of U.S. immigrants are coming from China, and most are well-versed in the English language, thanks to companies like EDU.
Tim Lutts, Chief Analyst of our Cabot Stock of the Week advisory, recently wrote, “New Oriental serves 36 million students through 87 schools and 994 education centers. It’s grown revenues more than 20% in each of the past three years."
Tim Lutts continued, "In the second quarter of 2019, revenues slowed to grow just 20% while earnings grew 9% to $0.60 per share. Its P/E is 41. The stock had a correction of 53% last year but has rallied back well and is now very close to breaking out to new highs.”
His analysis continues to be correct; the shares are trading near their 52-week high, and the company beat analysts’ EPS estimates by $0.07 in its latest quarter, prompting Wall Street to forecast its 5-year growth at an annual pace of more than 25%.
Next, hailing from the housing sector, is Mid-America Apartment Communities, Inc. (MAA), which has ownership interest in 102,629 apartment units, including communities currently in development, across 17 states and the District of Columbia.
It focuses on the ownership, management, acquisition, development and redevelopment of quality apartment communities in the Southeast, Southwest, and Mid-Atlantic regions of the United States.
The company is well-diversified across more than 30 markets in the Sunbelt, and offers substantial economies of scale due to its size.
For its recent quarter, funds from operations grew to $1.53, up from $1.50 a year ago, and revenues rose $415.63 million, up from $397.11 million. Analysts favor this stock, forecasting 27.5% growth this year.
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