Last Monday, March 18, they joined the local market 10 new CEDEARS, among which companies such as Nubank (NU), Palantir Technologies (PLTR) y Lithium Americas Corp (LAC).
In this special report we first present a brief review of the characteristics of this type of financial asset and describe the business to which each of the companies that are incorporated are dedicated, adding some data of interest.
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What are CEDEARs?
Son financial assets with local operations, which represent ordinary shares of companies listed abroad.
How are they negotiated?
They are negotiated in both pesos and dollarsalthough it is worth noting that currently the largest volume of operations occurs in pesos.
What exactly do they represent?
These certificates generally They represent a fraction of the action in question, This implies that, although CEDEARs can be operated in units, if you want to have in your portfolio the equivalent of a share listed abroad.
What are the advantages of buying CEDEARs?
The allows you to invest in some of the most important companies in the world without having to have an account in the United States.
The low amounts necessary to purchase CEDEARs make it possible to create a diversified portfolio, which allows the risk-return relationship to be optimized.
The position remains dollarized since the price is not only adjusted according to the variation in the share price in the foreign market, but also based on changes in the CCL dollar price.
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CEDEAR itself can be bought and sold in both pesos and dollars, so you could buy it in pesos and when you sell it, do so in dollars. In any case, it must be clarified that there could be liquidity problems in dollar operations.
The same rights are acquired (dividends, subscription of new shares due to capital increase, votes, etc.) that an investor who purchases the original share in the corresponding international market has.
What are the 10 new CEDEARs?
– Nu Bank (NU): It is the largest digital bank in the world, offering a full range of financial products through a mobile application and has more than 93 million customers. Since its founding, it has shown impressive growth, adding more than 19 million new customers in 2023 alone.
As one of the world‘s leading technology companies, Nu leverages proprietary technologies and innovative business practices to create new financial solutions and experiences for individuals and SMEs. NU promotes access to financial services throughout Latin America, explaining the company’s accelerated growth.
Throughout 2023 it obtained revenues of USD 8,000 million, marking a growth of 57% compared to the previous year, and net income of USD 1,000 million.
– Palantir Technologies Inc (PLTR): It is an analytics software company that focuses on leveraging data to create efficiencies in its clients’ organizations. The firm serves commercial and government clients through its Foundry, Apollo and Gotham platforms.
The company has a solid customer base, which includes long-term contracts with the United States government, thanks to its cutting-edge technology. It also has a scalable business model, with potential for expansion into new markets and sectors.
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Thanks to its long-term contracts, it has recurring and predictable income, highlighting a high gross margin and an annual growth of 21% in its income. In 2023 it obtained a net loss of USD 433 million, marking an improvement of 17% compared to the previous year.
– Lithium Americas Corp (LAC): It is an exclusive producer of Lithium in North America that operates its sole headquarters in Thacker Pass, Nevada, which recently began construction and production is expected to begin between 2025 and 2026. Thacker Pass is one of the largest lithium resources in the world .
Management plans to develop the headquarters into a fully integrated lithium production site at the same location, and will sell its products to the lithium chemicals market.
This is a company that has great growth potential as lithium production from its projects increases.
– Advance Auto Parts (AAP): It is a leading supplier of automotive parts in the aftermarket, serving both professionals and do-it-yourself customers. Its stores and branches offer a selection of well-known brands, original equipment manufacturers and private label automotive replacement parts.
It operates approximately 4,770 stores and 316 branches within the United States, Canada, Puerto Rico and the Virgin Islands. The stores carry a variety of products that serve the spare parts needs for both domestic and imported automobiles.
During the year 2023, the company obtained revenues of USD 11.3 billion, marking an increase of 1.2% compared to 2022. Net income resulted in USD 29.7 million, seeing a sharp drop compared to net income of USD 464, 4 million viewed in 2022.
– McEwen Mining Inc (MUX): It is a production and exploration company for precious minerals in Argentina, Mexico and the United States. Income is mainly derived from the production of gold and silver. McEwen owns and operates the wholly owned “El Gallo 1” mine in Mexico, where more than half of its gold production comes from, and has a minority stake in the company that operates the San José mine in Argentina.
It can be a good alternative if you want to have exposure to precious materials, such as gold, which has seen a significant rise so far this year.
– PagSeguro Digital Ltd (PAGS): It is a financial technology company that offers online and offline payment solutions for consumers, microbusinesses, and small and medium-sized businesses (SMEs). The company operates in Brazil, one of the largest e-commerce markets in Latin America.
In the last quarter of 2023, the company reported a profit per share of about USD 1.63, a figure that was above analysts’ forecasts. In turn, it reported revenues of USD 4.35 billion, data that also exceeded consensus forecasts.
Among the attractive points for a person who wants to invest in this company, the truth is that the online payments market in Brazil has great growth potential, driven by the growing penetration of the internet and the increase in electronic commerce.
– StoneCo Ltd (STNE): It is a Brazilian provider of financial technology and software solutions. The company has seen steady growth in its revenue and payment volume in recent years. The company expects to continue growing as the adoption of digital payments increases in Brazil.
In its last results presentation, the company reported a profit per share of about USD 1.32, a figure that was above analysts’ forecasts. In turn, it reported revenues of USD 3.14 billion, data that also exceeded consensus forecasts.
StoneCo offers a wide range of products and services, including point-of-sale terminals, business management software and loans. This allows the company to diversify its sources of income and reduce its risk.
– Marvell Technology Inc (MRVL): It is an American semiconductor company from Delaware, founded in 1995 that is dedicated to chip design, being leaders in wired networks. They offer solutions for data centers, operators, enterprises, automotive and consumer through their wide range of products such as data infrastructure optimized for cloud and AI or their silicon solutions for 5G networks.
It is a company that has a solid growth trajectory thanks to the rising demand for digitalization and its leadership in key markets such as 5G, automotive and data centers.
It had annual revenues of USD 5.5 billion, and a net loss of USD 933 million. It has more than 6,500 employees, with a presence in Argentina and offices around the world.
– Shapeways Holdings Inc (SHPW): Shapeways Holdings operates in the digital transformation industry, offering on-demand additive manufacturing services through its platform that allows clients to transform digital designs into physical products.
It is a leading global 3D printing company, with customers in more than 180 countries thanks to its wide range of materials, techniques and innovative technology that allows customers to transform digital designs into physical products.
During the last year it obtained revenues of USD 140 million, marking an annual growth of 21%. And while the company posted an annual loss of $24.5 million, it currently has an attractive P/E of 0.35.
– SunCar Technology Group Inc (SDA): It is a leading China provider of digitized auto after-sales services and online auto insurance brokerage services. This works by offering personalized solutions to corporate clients.
It is a company founded in 2015 with a presence in more than 10 cities in China that has a stable and growing customer base, particularly for the after-sales and auto insurance segment.
In 2023 it obtained revenues of USD 154 million and a net profit of USD 12.8 million, marking year-on-year growth of 19% and 32% respectively.
What do these new cedars mean in the local market?
The inclusion of these 10 instruments is more than positive for the local financial marketsince they allow investors a greater number of alternatives to choose from in which to invest to boost your savings. The interesting thing about these included assets is that They expand the possibility of investing in some sectors or industries that have sparked interest in the investment community.
Among the most attractive, we highlight the introduction of NuBank (NU), a Brazilian company that is revolutionizing the world of finance with its completely digital approach, which since its introduction has registered surprising growth, capturing the attention of well-known investors such as Warren Buffet, who owns a stake in the bank.
Another notable asset is Palantir (PLTR), the data analysis company, has benefited from the increase in demand for its services and the implementation of artificial intelligence in its productsand although it is not yet profitable, it has a solid client portfolio and long-term contracts that give greater stability to its income.
Finally, we would like to highlight the company Lithium Americas Corp (LAC), the company belongs to same group that owns the Cauchari-Olaroz lithium deposits in Jujuy, although it is important to clarify that they are separate legal entities with different lithium projects. This new CEDEAR allows investing in a pure lithium producer with a large-scale project for a market in which accelerated growth is expected in the coming years.
* Research Manager de IOL invertironline