EWW Stock Recent News

Trump's tariffs cause short-term volatility, but long-term market impact is minimal; earnings remain the key focus for investors. The three countries in questions are Canada, China, and Mexico. This blog dives into several major companies domiciled in one of those three countries. In the long-term scheme of things the fundamentals of the companies behind these ADRs and stocks are likely to be more deterministic than any geopolitical factors.

The 'Fast Money' traders talk volatility in the market as tariff whiplash hits Washington.

US stocks staged a partial recovery on Monday after initially plunging on fresh tariff concerns. The Dow Jones Industrial Average rebounded from a steep intraday drop after President Donald Trump announced a temporary halt to tariffs on Mexican goods.

Political and macro uncertainties have reduced EWW's EPS growth estimates and price targets, reflecting concerns about future prospects. EWW trades at historically low valuations with a 9.3x PE on YE25 estimates, suggesting any positive news could trigger a rally. I upgrade EWW to Hold due to discounted valuations but caution against Trump tariff threats that could severely impact Mexico's economy.

The 'Undercovered' Dozen series highlights lesser-covered ETFs, offering insights from various authors on potential opportunities and trends in this space. The Janus Henderson AAA CLO ETF (JAAA) invests in AAA tranches of CLOs, providing lower risk through diversification and predictable outcomes, according to John Bowman. Stratos Capital Partners views the Vanguard Extended Duration Treasury ETF (EDV) as attractive for its high-yield and potential bond price appreciation as interest rates decline.

Mexico's stock market struggled in 2024, with the iShares MSCI Mexico ETF dropping more than 25%. Historical parallels suggest Mexican stocks may rebound following President-elect Trump's inauguration, similar to their recovery in 2017. Mexico benefits from reshoring trends, with increased foreign direct investment in manufacturing, logistics, and technology services.

Shanghai CSI 300 has gone from a 52-week low to a 52-week high in only a couple of weeks. Other than China and Hong Kong, Australia is the only other international market starting the week at a 52-week high.

Political risk in Mexico has been exacerbated by the dominance of the Morena Party control and controversial constitutional reforms. Foreign direct investment (FDI) in Mexico is declining. Drug cartel violence and organized crime intrusion into the normal economy is disruptive to supply chains and public safety.

Downgraded from Buy to Sell due to further political risks from constitutional "reform" and a potential second Trump term. The Mexican market has seen a 10% weaker Peso and a 15% decline in the EWW during political uncertainty that can persist in the next 5 months. EWW's valuation appears cheap post-sell-off at 11x PE, but analysts' downgrades are likely on weaker FX and increased country risk as we head into the 2Q24 earnings.

Investors should avoid “hasty” portfolio changes based on predictions for upcoming elections after recent political surprises in countries including France triggered market losses, according to Principal Asset Management's Seema Shah.