Brazil at 26% Discount to Global Stocks Lures Mobius

The biggest decline in the Bovespa index in three months has turned Brazilian stocks into Latin America’s best bargain, according to Templeton Asset Management and Emerging Markets Management LLC.

The Bovespa retreated 7.4 percent from a 19-month high on Jan. 6, the most since an 11 percent decline in the second half of October. The 63-company gauge trades for 20.3 times reported earnings over the past 12 months, a 26 percent discount to the 27.5 times for the MSCI AC World Index of emerging- and developed-nation shares, according to Bloomberg data.

“The most attractive market in Latin America is Brazil,” Mark Mobius, who oversees about $34 billion of developing-nation assets as chairman of Templeton Asset Management, said in an interview in Bangkok yesterday. “Its valuation is not excessive.” (more)