The Best Mexican Company You've Never Heard Of? Time To Learn About Betterware de Mexico

One of the top-performing SPACs of 2020 was a direct-to-consumer company in Mexico that most investors probably have never heard of. With a large marketing push, acquisition and international expansion coming, the stock could be in for a strong 2021 as well.

About Betterware de Mexico Betterware de Mexico SAB de CV BWMX is the leading direct-to-consumer company in Mexico, covering the home organization and solutions segment with a two-tier distribution model. It has a network of over 59,000 distributors.

Betterware de Mexico completed its SPAC merger in 2020.

The company was bought in 2001 by Luis Campos, who was the chairman of Tupperware Brands Corporation TUP Americas division from 1994 to 1999. Campos is the current executive chairman of Betterware de Mexico.

Acquisition: On Monday, Betterware de Mexico announced it was acquiring 60% of GuruComm, a mobile virtual network operator and communications software developer.

See also: How to Invest in SPACs 

The acquisition adds compelling technology in the home solutions field to the company. This acquisition also gives Betterware de Mexico more products to offer its distributors with the company planning to sell high-quality, value-priced home technology items.

“The acquisition makes a very important milestone for Betterware as it evolves our home product offerings to include technology-based solutions, which we expect to add to our long-term growth and profit potential,” Campos said.

Marketing Campaign: Betterware de Mexico announced its largest-ever marketing campaign in January. The company is running advertisements across TV, radio, billboards, subways, bus stations and social media.

The advertisements began on Jan. 15 and will run through the end of the year, with the company expecting to reach more than 65 million customers.

The company said in its latest investor presentation that it had 20% household penetration in Mexico, which could mean there is room to expand with strong brand awareness.

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International Expansion: The company has expanded to additional countries such as Guatemala, where it was profitable in less than a year, showing the business could be scalable to additional territories. Possible new markets listed in the presentation were Panama, Costa Rica, Colombia and Peru.

Financials: Betterware de Mexico had compounded average annual growth of 62% from 2016 to 2020.

In the fourth quarter, the company saw revenue increase 229% year-over-year. For the last full fiscal year, revenue was up 135% year-over-year.

The company is guiding for fiscal 2021 revenue to increase 46% year-over-year.

Share Performance: From the time of its SPAC merger close in 2020 to the end of the year, Betterware de Mexico shares were up 297%. This was the best performance of all the SPACs that completed a deal in 2020 for the period of merger close to the end of the year.

BWMX Price Action: Shares of Betterware de Mexico traded around $38.20. The stock has traded as high as $45.69 over the last 52 weeks.

(Photo by Alexander Schimmeck on Unsplash)