Five stocks for investors who want to broaden -2-

Budweiser Brewing Co. APAC Ltd.

Budweiser Brewing Co. APAC Ltd. is based in Hong Kong and majority owned by Anheuser-Busch InBev SA (ABI.BT). So this is, essentially, a U.S. company, although most of its beer sales are in China.

Thom said that no matter where this subsidiary is based or its stock listed, he believes in the company's growth potential in China's premium beer market. You can see in the table that analysts expect rapid earnings growth through 2025.

He described the segmentation of the beer market in China, with local brands taking the less expensive segment. As the middle class grows, there is more opportunity for the company beyond its flagship Budweiser brand, especially in the country's wealthier coastal cities, he noted.

At the "super-premium level," Budweiser Brewing Co. is set to compete well with brands such as Corona, Hoegaarden and Stella Artois, he said.

The stock has fallen 30% this year, with dividends reinvested, as concerns over China's slowing economic growth have taken their toll. But Thom said he still believes the company is well-positioned as middle-class household formation continues its long-term upward path in the country.

Taiwan Semiconductor

Investors may be concerned over the prospect of China making an aggressive move to take over Taiwan. But no matter how the political situation develops, Thom said he is confident about Taiwan Semiconductor Manufacturing Co. Ltd. (2330.TW) because "it is almost as if it is too important to fail."

"Irrespective of whether it is in Taiwanese or Chinese control, the world needs what they produce. They have an effective monopoly on advance chip manufacturing," he said.

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-Philip van Doorn

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09-16-23 0839ET

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