Global Index Briefing: Emerging Markets MSCI January 3, 20 Dr. Ed Yardeni 16-972-7683 eyardeni@ Joe Abbott 732-497-306 jabbott@ Please visit our sites at www. blog. thinking outside the box
Table Of Contents Table Of Contents Emerging Markets MSCI Stock Price Index 1 Blue Angels Forward Earnings and Valuation 2 Earnings 3 Revenues 4 NERI & Margins Earnings Growth & Valuation 6 January 3, 20 / Global Index Briefing: Emerging Markets MSCI www.
Stock Price Index 69000 9000 Figure 1. EMERGING MARKETS MSCI INDEX (ratio scale, daily) 1/2 1600 1400 49000 39000 Local currency US$ 1200 00 800 29000 600 19000 400 9000 199 1996 1997 1998 1999 2000 2001 2002 2003 2004 200 2006 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019 Source: MSCI. 200.40 Figure 2. EMERGING MARKETS MSCI INDEX CURRENCY RATIO (US$ index / local currency index, daily).40.3.3.30.30.2.2.20 1/2.20.1 1996 1997 1998 1999 2000 2001 2002 2003 2004 200 2006 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019 Source: MSCI..1 Page 1 / January 3, 20 / Global Index Briefing: Emerging Markets MSCI www.
80000 70000 60000 Figure 3. Blue Angels Forward Earnings and Valuation EMERGING MARKETS MSCI, FORWARD EARNINGS, & VALUATION (in local currency) Emerging Markets MSCI Index 01/02/ x1 Blue Angels Implied Price Index* 12/29/ 80000 70000 60000 0000 x 0000 40000 40000 30000 20000 x 30000 20000 000 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019 000 * Implied price index calculated using forward earnings times forward P/Es. Monthly through December 200, weekly thereafter. Source: MSCI and Thomson Reuters I/B/E/S. 2000 0 100 120 Figure 4. EMERGING MARKETS MSCI, FORWARD EARNINGS, & VALUATION (in US$) Emerging Markets MSCI Index 01/02/ Blue Angels Implied Price Index* / x1 2000 0 100 120 00 x 00 70 70 00 x 00 20 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019 20 * Implied price index calculated using forward earnings times forward P/Es. Monthly through December 200, weekly thereafter. Source: MSCI and Thomson Reuters I/B/E/S. Page 2 / January 3, 20 / Global Index Briefing: Emerging Markets MSCI www.
Earnings 600 00 400 Figure. EMERGING MARKETS MSCI EARNINGS PER SHARE (in local currency) (analysts average forecasts, ratio scale) 19 12/29 600 00 400 300 300 200 200 100 100 Forward earnings* 00 199 1996 1997 1998 1999 2000 2001 2002 2003 2004 200 2006 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019 00 * Time-weighted average of consensus estimates for current year and next year. Monthly through December 200, then weekly. 10 130 1 90 Figure 6. EMERGING MARKETS MSCI EARNINGS PER SHARE (in US$) (analysts average forecasts, ratio scale) 19 10 130 1 90 70 70 0 0 30 30 Forward earnings* 199 1996 1997 1998 1999 2000 2001 2002 2003 2004 200 2006 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019 * Time-weighted average of consensus estimates for current year and next year. Monthly through December 200, then weekly. Page 3 / January 3, 20 / Global Index Briefing: Emerging Markets MSCI www.
Revenues 9000 80000 6000 Figure 7. EMERGING MARKETS MSCI REVENUES PER SHARE (in local currency) (analysts average forecasts, ratio scale) 19 12/29 9000 80000 6000 0000 0000 3000 3000 Forward revenues* 20000 2004 200 2006 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019 20000 * Time-weighted average of consensus estimates for current year and next year. Monthly through December 200, then weekly. 00 1600 Figure 8. EMERGING MARKETS MSCI REVENUES PER SHARE (in US$) (analysts average forecasts, ratio scale) 00 1600 1400 1200 19 1400 1200 00 00 800 800 600 Forward revenues* 600 400 2004 200 2006 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019 400 * Time-weighted average of consensus estimates for current year and next year. Monthly through December 200, then weekly. Page 4 / January 3, 20 / Global Index Briefing: Emerging Markets MSCI www.
1 Figure 9. NERI & Margins EMERGING MARKETS MSCI NET EARNINGS REVISIONS* 1 0 Dec 0 - - - - -1-1 -20-2 -30 NERI Oct -0.02 Nov 1.66 Dec 1.70 199 1996 1997 1998 1999 2000 2001 2002 2003 2004 200 2006 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019-20 -2-30 * Three-month moving average of the number of forward earnings estimates up less number of estimates down, expressed as a percentage of the total number of forward earnings estimates. 11 Figure. EMERGING MARKETS MSCI PROFIT MARGIN (using analysts average earnings and revenues forecasts) 11 9 9 8 8 19 7 7 6 Forward profit margin* (7.3) 6 2004 200 2006 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019 * Time-weighted average of the consensus estimates for current year and next year. Monthly through December 200, weekly thereafter. Page / January 3, 20 / Global Index Briefing: Emerging Markets MSCI www.
40 3 30 2 Figure 11. Earnings Growth & Valuation EMERGING MARKETS MSCI STEG, STRG, & LTEG (percent) LTEG* (22.6) STEG* (13.0) STRG* (8.6) 40 3 30 2 20 20 1 1 0 0 - - - -1 2006 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019 Note: STEG is year-ahead forward consensus expected short-term earnings growth. STRG is year-ahead forward consensus expected short-term revenue growth. LTEG is five-year consensus expected long-term earnings growth. - -1 2 20 Figure 12. EMERGING MARKETS MSCI VALUATION Forward P/E* (12.4) 2 20 1 1 1.0 1.2 1.00 Relative P/E** (0.8) PEG Ratio*** (0.) 1.0 1.2 1.00.7.7.0.2 199 1996 1997 1998 1999 2000 2001 2002 2003 2004 200 2006 2007 2008 2009 20 2011 2012 2013 2014 201 2016 20 20 2019.0.2 * Price divided by forward consensus expected operating earnings per share. Monthly through December 200, then weekly. ** Forward P/E relative to MSCI World forward P/E. *** Forward P/E relative to consensus -year LTEG forecast. Page 6 / January 3, 20 / Global Index Briefing: Emerging Markets MSCI www.
Copyright (c) 20. All rights reserved. The information contained herein has been obtained from sources believed to be reliable, but is not necessarily complete and its accuracy cannot be guaranteed. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness, or correctness of the information and opinions contained herein. The views and the other information provided are subject to change without notice. All reports posted on www., blog., http://blog. and YRI s Apps for ipads and iphones are issued without regard to the specific investment objectives, financial situation, or particular needs of any specific recipient and are not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Past performance is not necessarily a guide to future results. Company fundamentals and earnings may be mentioned occasionally, but should not be construed as a recommendation to buy, sell, or hold the company s stock. Predictions, forecasts, and estimates for any and all markets should not be construed as recommendations to buy, sell, or hold any security--including mutual funds, futures contracts, and exchange traded funds, or any similar instruments. The text, images, and other materials contained or displayed on any product, service, report, email or website are proprietary to and constitute valuable intellectual property. No material from any part of www., blog., http://blog. and YRI s Apps for ipads and iphones may be downloaded, transmitted, broadcast, transferred, assigned, reproduced or in any other way used or otherwise disseminated in any form to any person or entity, without the explicit written consent of All unauthorized reproduction or other use of material from Yardeni Research, Inc. shall be deemed willful infringement(s) of this copyright and other proprietary and intellectual property rights, including but not limited to, rights of privacy. Yardeni Research, Inc. expressly reserves all rights in connection with its intellectual property, including without limitation the right to block the transfer of its products and services and/or to track usage thereof, through electronic tracking technology, and all other lawful means, now known or hereafter devised. reserves the right, without further notice, to pursue to the fullest extent allowed by the law any and all criminal and civil remedies for the violation of its rights. The recipient should check any email and any attachments for the presence of viruses. accepts no liability for any damage caused by any virus transmitted by this company s emails, website, blog and Apps. Additional information available on request. requests@