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Strategies & Market Trends : Value Investing
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To: Spekulatius who wrote (17063)9/30/2003 5:43:50 PM
From: Paul Senior  Read Replies (2) of 78525
 
Spekulatius, I'm still considering your cautionary post about Euro-domiciled companies earning dollars in an environment where the Euro is strong against the dollar.

Seems like such companies' stock might indeed be affected: at the least I'm now reading cautionary statements by market pundits. Maybe it's still too soon for exchange issues to show in earnings. So more bad news might be ahead.

I'm still holding a bit of DCX. I've now added a very small amt. of BMW. I like BMW's history of successful niche products and its profitability. P/e's a bit high compared to other car manufacturers, but than again, BMW doesn't have the same problems as many of the manufacturers who build and sell in all segments of the car/truck market.

It's my opinion that BMW WILL be one of the companies adversely affected by a strong Euro. I am hoping that that might be offset sufficiently by price increases that don't cripple demand for the company's popular products. And car companies of course have several ways to increase prices to the consumer without actually increasing sticker prices.

I am guessing only, but it seems to me the outlook for BMW products in China and emerging countries will become stronger over time, and for now, BMW has a list of attractive products. Perhaps this makes BMW more of a possible long-term play vs. a trading stock as many car stocks seem to me to be.

Jmo, I could be very wrong, so just a small exploratory position for me.

Paul Senior
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