When the US Dollar experienced its big decline in the years leading up to the 2008 rally, stocks with high amounts of international revenues outperformed as businesses in other countries bought more goods from US companies. As the Dollar made its comeback last year and earlier this year, stocks that generated most of their revenues domestically outperformed. But now that the Dollar has pulled back again, the international revenue trade has made a comeback.
We broke up the S&P 500 into deciles (50 stocks in 10 groups) based on a stock's percentage of international revenues and calculated the average performance of stocks in each decile since the May 8th market top. Over this same time period, the US Dollar has declined quite a bit as well. As shown below, the 50 stocks with the highest percentage of international revenues are down just 1.3%, while the 50 stocks with the lowest percentage of international revenues are down 7.9%.
Depending on which way you think the dollar will go from here, you can play stocks with high amounts of international revenues or low amounts. One of the only places to find a stock's percentage of domestic and international revenues is Bespoke Premium. Yearly members have access to this information for all S&P 500 and Russell 1,000 stocks going back three years. And even if you don't want to use the info as a strict dollar play, it's still good to know the geographic revenue breakdown for the stocks in your portfolio. Subscribe to Bespoke Premium and receive our International Revenues Database free today.