Autos: F could be bought here. As for me, I'll add to my Ford shares if stock drops 10% on no adverse news. My preference and largest position among auto manufacturers I hold is Volkswagen (VLKAY.pk). I hold Hyundai, bought through EWY.
I am only buying Toyota (TM) now as stock continues to fall. I have to assume weather problems are/were temporary. Perhaps the more lingering problem is the expensive yen which decimates TM's exports (TM profits). Eventually - as they have done since WW2, Japanese government will intervene to juggle the monetary system and/or change internal laws to aid Japanese manufacturers.
I'm figuring maybe a three year holding period for me for these stocks.
Several conflicting aspects:
1. All manufacturers rushing together into China. China economy slowing, and possible glut of middle/upper-class cars that bring in the good profits for the manufacturers. Also China demanding technology/joint ventures from the manufacturers if they want to continue in China.
2. Aging fleet of US cars. As stated, people keeping cars longer (reported to be 50K more miles longer on average). Replacement is inevitable though. Inevitable (?) that in few years, more new cars will be sold than now. (And if demand for used-cars remains strong, auto retailers -- Penske (PAG), et al. - should do very well.)
I can't make a compelling case that any of these stocks are value buys just on their metrics. Company profitability history is erratic. For me, some of the stocks are cheap enough now though --given that I'm making a theme-based investment: Demand for new cars will surface in next several years in US, and as status-conscious emerging market consumers become more affluent and numerous, they will continue to upgrade to more expensive cars. |
