Many investors usually don't equate strong growth with large cap stocks. Often, investors exchange growth for additional safety by investing in the largest and safest blue chip names. However, if you are willing to look overseas in countries with fantastic long-term growth opportunities, some excellent larger firms pose excellent future growth and thus great investment returns.
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Start with China
Chinese oil giant PetroChina (NYSE:PTR) is a $204 billion integrated oil company and looks poised for great growth over the long-term. With PetroChina, you get fantastic assets in oil interests all over the world without having to invest in them directly. The company's refining segment has one of the largest networks of gas stations in China and that will surely grow as the Chinese population continues to urbanize. (For more, see Investing In China.)
PetroChina is attractively valued in relation to its peers, with a P/E of 12. China Petroleum (NYSE:SNP) currently fetches 13.5 times earnings, while CNOOC (NYSE:CEO) currently commands a P/E of 25. Also PetroChina has an excellent history of paying out a chunk of its profits in the form of dividends which currently represents a yield of 3.5 percent.
Another play on China's growth is China Mobile (NYSE:CHL), one of China's largest telecommunications companies. The company's current subscriber base already exceeds 450 million, greater than the entire U.S. population. But with 1.3 billion Chinese people, the potential growth is still readily available. And while you wait, you get paid 3.6% in the form of a dividend.
Canada's Wonderful Commodity Gem
Another excellent bet is Teck Resources Limited (NYSE:TCK), a diversified Canadian metals company with operations all over the world. Teck gives the investor an excellent exposure to commodities like zinc, copper, gold, coal and a host of other specialty metals. Last week, China agreed to buy 17% of Teck for $1.5 billion, effectively valuing the company at $8.8 billion. This represents a 10% premium to last weeks closing value of $7.8 billion.
With China shopping all over the world to secure commodities on the cheap, investors may now have an excellent chance to own an excellent company at a good price with wonderful long-term growth potential.
Bottom Line
Small cap companies are not the only investment opportunities with attractive return scenarios over the next several years. There is great growth to be found abroad and patient investors looking for excellent investment candidates should consider adding some quality international exposure. (For further reading, see Going International and Determining What Market Cap Suits Your Style.)
