The rise in Valuation of African Equities

Merrill Advisor's Stan Luxenburg reports:

The market capitalization of listed sub-Saharan companies has climbed from 89% of GDP in 2000 to 137% in 2005, according to the World Bank. That suggests
a sharp rise in the valuation of African equities...While every major company on the Chinese and Indian exchanges may be followed by as many as 30 analysts, an African stock does wellto catch the attention of five. But equities in more popular Chinese and Indian markets are also much pricier than African shares. “If you look at price/earnings ratios or price/sales ratios, the other emerging markets are an awful lot more expensive than stocks in Africa,” says Merrill Lynch’s Rasco.