I recently wrote an article for Seeking Alpha on 5 of my favourite foreign (ADR) shares on the market at the moment. These are all ADRs (American Depositary receipts) listed on the NYSE, the last one is on the Nasdaq:
5 Top Foreign Stocks
With US stock markets at record highs there has been a significant amount of speculation calling for a market correction.
While timing a correction may be near impossible it is quite true that US markets are expensive at the present time.
Cyclically adjusted P/E for the overall US stock market is amongst the highest in the world at 25.8 – 56.4% higher than the historical mean. While price to book for the market hovers around 2.77.
This compares to a CAPE ratio of just 10.85 in China or 6.08 in Greece. With respective price to book ratios of 1.07 and 1.12.
Further, an analysis of 34 stock markets in the world finds that the US is the second most expensive behind Singapore. Cheaper stock markets can be found in China, Japan, Greece, Russia and Hong Kong, among others.
For US investors, this poses a problem.
US stock markets are expensive and there may be better options in international markets. However, buying foreign shares is not easy for US traders and exposes an investor to currency risk.
With that in mind, I decided to run a stock screen on all ADR shares listed on the NYSE and Nasdaq in order to find the best foreign shares listed on US markets.
I then drilled down into each company a little further and came up with the following 5 gems:
What do you think of these foreign stock picks?
Would you ever invest in foreign shares?