Earnings for Emerging Market Consumers Expected to Outpace EM

May 14, 2018 |Author: Edward Kerschner, CFA | Categories: Chart of the Week, Emerging Markets


EM consumers earnings rising sharply. The earnings growth for the Dow Jones Emerging Markets Consumer Titans 30 Index (DJECON Index) is expected to outpace the MSCI Emerging Market (EM) Index. Bloomberg consensus estimates are that the DJECON Index will see earnings growth of 40% and 21% in 2018 and 2019, respectively. This compares to the earnings growth of the 22% and 11% in 2018 and 2019, respectively, for the MSCI EM Index.   

Which industry will lead? This 40% surge in earnings in 2018e is led by forecasted gains in General Retailers (+383%), Food Producers (+51%), Beverages (+47%), Automobiles & Parts (+19%) and Travel & Leisure (+19%)—including several stocks with rebounds from unusually depressed levels.  For 2019 earnings growth of 21% seems both a more normal rate and impressive.

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