Mercedes-Benz. (DMLRY). I listened to first half presentation. Agree that CEO seems very impressive. Stock is cheap, so too is BMW (BMWYY). As are other car manufacturers, it seems to me. Dividend is high, yes. Sustainably so, I don't know. As you know, European companies are more willing to lower dividends with drops in earnings. Both Mercedes and BMW dividends are unusually high now. Mercedes split out its truck division, so it remains to be seen - imo - how the dividend might be next year or after.
In the interview, CEO seemed to be saying they will take control over the software for as many applications as they can. They will have their own "Mercedes Operating System". The car will be kept "new" by having software downloads, like Apple does with IOS for example. In the part I listened to, the interviewer seemed to focus this activity as regards the self-driving aspect and the infotainment aspect. Only touched upon was how Mercedes might get revenue from this. To me it's somewhat more frightening in that I believe these car companies will demand subscription services for as many aspects as they can. I foresee as an example, your "air conditioning" will be free for three years after you buy your vehicle. After that, you will have to subscribe to the "aircon" update to get air. Same with cruise control. Etc. Ugh. Oh well, just my opinion.
I still hold a few GM, and have added to STLA (Fiat). Overall, I prefer retail retail dealers. As long as this model of selling cars holds, they should do ok. They don't have the capital expenses of the manufacturers, and in a downturn, they can more easily (than the manufacturers) reduce staff. They have product and geographical diversity. There is consolidation in the industry which may give some support to the stocks.
The least expensive one in my view now is SAH.
finance.yahoo.com |
