HOLT Emerging Markets View "Where are earning revisions turning up?" Gogus

Research evidence excerpt

HOLT Emerging Markets View "Where are earning revisions turning up?" Gogus

Global Research

24 July 2026ab

HOLT Emerging Markets View Equities

Emerging MarketsWhere are earning revisions turning up?

Selim Gogus, FCA

HOLT Sector Specialist

A momentum driven market selim.gogus@ubs.com

+44-20-7888 6483

EM stocks with the highest HOLT Momentum Factor exposure have delivered the

strongest performance over the past 18 months. This AI-fuelled rally has also coincided

with a re-rating in forecast CFROI levels to record highs.

Positive CFROI revisions are all Tech albeit with concentration risks

CFROI revisions have been varied across emerging markets. Tech stands out with the

strongest positive CFROI revisions driven by AI supply chain stocks. Materials and Energy

are the only other sectors with positive CFROI revisions (Figure 4CFROIRevisions(last13wks)byEMSector).

However, we note that the topic of EM concentration also extends to the CFROI revisions

for EM Tech, driven by strong earnings upgrades for the top 3 index heavyweights,

TSMC, SK Hynix and Samsung. The earnings momentum story for EM Tech appears

more muted when these three stocks are excluded (Figure 6CFROIRevisions(3month)-EMTechex-TSMC,SKHynix,Samsung).

The opportunity may be in those stocks where earnings and price momentum have

diverged. We screen for stocks which have positive CFROI revisions, yet have

underperformed relative to the market (see screen in HOLT Lens). LinktoscreninHOLTLe

Should CFROI revisions be more positive based on economic indicators?

The CFROI Revisions Breadth for EM stocks remains at only 50% despite the UBS

Economic Growth Surprise Index showing positive EM economic releases, if upside

surprises persist, this may support more positive CFROI revisions.