Companies Poised to Profit From Emerging Market Development: Vale SA (ADR) (VALE), Cemex SAB de CV (ADR) (CX), Gerdau SA (ADR) (GGB)

Caterpillar Inc. (NYSE:CAT) shed 19%, partly on fears of a housing slowdown in China due partly to high interest rates. Still, long term, China has a lot of building and developing to do, and will likely need much equipment from Caterpillar. With a current P/E ratio near 11 and a forward P/E near 9, the stock does seem compellingly priced, especially with its 2.3% dividend yield.

Brazil-based Vale SA (ADR) (NYSE:VALE), the world’s largest iron ore concern, shed 17% and recently yielded a solid 3.3% and a forward P/E of 8. It’s poised to profit from growth in China, and has been enjoying double-digit growth rates for revenue and earnings over the past few years, though earnings recently tumbled. The global recovery hasn’t been happening as rapidly as it would like, and in the past few months, it suspended activity at an Argentine mine. It bodes well that the company’s CEO is talking of restrained and disciplined capital spending.

The big picture
Demand for infrastructure work isn’t going away anytime soon. A well-chosen ETF can grant you instant diversification across any industry or group of companies — and make investing in and profiting from it that much easier.

The article Companies Poised to Profit From Emerging Market Development originally appeared on Fool.com.

Longtime Fool contributor Selena Maranjian, whom you can follow on Twitter, owns shares of Cemex. The Motley Fool has no position in any of the stocks mentioned.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.