Three Stocks Profiting from International Exposure – KO, YUM, MCD

Mention the world international markets these days and you will get frightened looks from people, as they immediately think about the European debt crisis. Yes, that is a big concern, but not a long-term viewpoint that profitable blue-chips use when constructing their investment strategy.

If we look over the next decade, there is a huge amount of potential for corporate earnings to grow from international markets. If we look at two countries with the biggest populations, China and India, you will notice the growth of the middle class, a huge number of potential customers. These are the clients that blue-chips based here in the U.S. are developing their investment strategy for over the next decade.

I’ve identified three blue-chips that have a solid investment strategy for corporate earnings growth over the long term. The first is The Coca-Cola Company (NYSE:KO). The company just released its investment strategy and management is extremely optimistic. Jacob Robbins, managing director of the global sweeteners unit of the group, said that he expects 800 million new customers over the next decade, with most of that growth coming from the BRIC (Brazil, Russia, India, China) nations.

Coca-Cola expects to double net revenue, from $100 billion in 2010 to $200 billion in 2020. Current corporate earnings exceeded estimates, coming in at $0.79 per share versus an expected $0.77. For the year, corporate earnings were approximately 10% higher than 2010. For such a big firm, this is a positive sign that its investment strategy is being properly executed and this firm retains its status with the elite of blue-chips.

Another firm that has shown outstanding corporate earnings from international expansion is YUM! Brands, Inc. (NYSE:YUM). The firm operates “Taco Bell,” “KFC” and “Pizza Hut.” The key for corporate earnings growth for blue-chips like YUM! Brands is an investment strategy to expand outside the U.S.

YUM! Brands expects to open 1,500 new stores outside the U.S. in 2012. This is following YUM! Brands’ expansion in 2011 when it opened over 1,500 stores internationally. China is a big part of the investment strategy and corporate earnings growth, as last year alone YUM! Brands opened 656 new stores.

YUM! Brands is the leader in China, compared to McDonald’s Corporation (NYSE:MCD), which is trying to catch up. YUM! Brands noted that same-store sales in China were growing very strong and the firm expects continued strength with new-store openings to drive corporate profits.

India is also a key driver for blue-chips like YUM! Brands. India is the second country in new-store openings for the firm, with 101 in 2011. This is the investment strategy that will pay off in large corporate profits a decade from now.

The third firm and one of the oldest blue-chips is McDonald’s Corporation. With a long-held investment strategy that has driven corporate profits for decades, McDonald’s knows how to execute an international strategy. With stores in over 118 countries and growing, the firm has a history of long-term growth. McDonald’s is now expanding fast in China to try and catch up with YUM! Brands. Its goal is to open a store a day for the next three to four years, according to Peter Rodwell, company president for Asia.

If you want to profit from the growth of countries like China or India, you don’t need to put your money in a small, unknown firm that might have questionable accounting practices and is traded on a foreign stock exchanges when you can invest in U.S. blue-chips with long histories of driving corporate earnings.

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