As we inch closer to the first wave of interest rate cuts, it’s an opportune time to consider emerging markets tech stocks.
Over the past year or so, these tech giants have undergone a major correction, with analysts highlighting promising opportunities in often-overlooked areas. For instance, Tom Lee of Funstrat Global Advisors paints a dynamic picture for small-cap stocks in August, primed for a 15% jump. These impressive growth numbers are driven by cooling inflation and the upcoming interest rate cuts.
Similarly, emerging markets tech stocks are also set to gain immensely from the evolving economic landscape. Hence, investors are looking to capitalize on market adjustments, and investing in the best tech players in emerging markets could prove lucrative over time. However, not all stocks are created equal, especially in emerging markets. That said, here are three stocks that continue executing brilliantly while offering superb upside ahead.
Emerging Markets Tech Stocks to Buy: Grab Holdings (GRAB)
Grab Holdings (NASDAQ:GRAB) is a Singaporean tech titan that continues to grow at a rapid pace. I discussed in a recent article how the company has blown past top-line estimates in the past nine straight quarters. Moreover, all estimates point to double-digit growth in sales for the foreseeable future, with encouraging progress toward profitability. Analysts expect it to break even with a four-cent profit by next year.
Surprisingly, Grab’s stock price hasn’t followed in line with its explosive fundamental growth. Yet, with upcoming rate cuts and a growing appetite for riskier investments, GRAB stock is primed for a tremendous surge in value ahead.
Its versatile super app, thriving in Southeast Asia’s rapidly expanding markets, solidifies its compelling growth narrative. In fact, according to the World Economic Forum, the region is on track to become a $1 trillion digital economy by 2030, setting the stage for massive long-term expansion ahead.
Jumia Technologies (JMIA)
Jumia Technologies (NYSE:JMIA) is a top eCommerce platform in Africa. Within a relatively short time, it swiftly established its presence in the region, becoming a key player in the continent’s rapidly expanding market. Consequently, JMIA stock has surged upwards of 413% in the past nine months, with more upside aside as it continues expanding its market share in the region.
Its powerful growth trajectory hasn’t gone unnoticed. Benchmark analysts recently rated the stock as a Buy, forecasting a double-digit upside from current prices. According to Fawne Jiang from Benchmark, Jumia is in an excellent position to capture the “unmet pent-up demand” in the region. Moreover, the International Trade Administration expects north of half a billion eCommerce users in Africa by next year, and 17% annually. Therefore, Jumia offers a compelling, high-risk, high-reward opportunity that offers sustained upside potential.
Nu Holdings (NU)
Nu Holdings (NYSE:NU) is the largest digital banking platform operating in the Latin American region, boasting north of 100 million customers across the region. With a remarkable 108% growth in its top line over the past five years, Nu Holdings stands out as one of the fastest-growing banks in its niche.
Its most recent quarterly report showed an impressive 64% bump in revenues to $2.7 billion, with deposits surging 53% to $24.3 billion. Net income also rose significantly to $378.8 million, up from $141.8 million the previous year.
Furthermore, smart money remains a big gamble on its long-term prospects. Japanese investment giant SoftBank (OTCMKTS:SFTBY) recently added 2.3 million shares, bringing its total holdings to 23.3 million. Also, the Saudi Arabian government followed suit, scooping up 1.18 million shares last quarter.
Adding to Nu’s bull-case is its innovative use of proprietary blockchain technology. It recently rolled out multiple blockchain-powered services through its partnership with Lightspark to significantly improve its customers’ banking experience.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
