Japanese automakers look good to Mark Kingdon, presenting at Delivering Alpha. They trade at 8-10x earnings and he thinks the multiple should be 13. HIs top picks are Toyota (TM), Mazda (MZDAF.PK, MZDAY.PK), and Fuji Heavy/Subaru (FUJHY.PK). He's also on the Aegerion Pharmaceuticals (AEGR +2.6%) train thanks to its Juxtapid drug for high cholesterol.
Japanese automakers continue to struggle in China as a hangover effect from a territorial dispute dampens the enthusiasm of buyers to buy models emanating from Japan. For the month of November, Toyota (TM) saw sales fall 22% in China, while Mazda (MZDAF.PK) dropped off 29%. Honda will release China vehicle sales totals later.
A thee-way joint venture between Ford (F), Mazda (MZDAF.PK), and Changan Automobile receives approval from Chinese authorities to split into two entities. Chinese partner Changan will be in the first venture with Ford and in a second with Mazda. The reason for the move is to give Ford and Mazda more breathing room to increase their individual presence in the nation.
Ford (F), Mazda (MZDAF.PK, MZDAY.PK) and their Chinese partner agree to invest an additional $37M in their engine plant venture, following surging sales of Ford cars in China. Ford's Focus model has been selling so well that workers at its Chongqing car plant in southwest China have added shifts to keep up with demand.
The Senkaku-Diaoyu islands dispute between Japan and China hit Japanese car makers hard in September, with Mitsubishi's Chinese sales plunging 63% Y/Y and those of Mazda by 35%. Toyota's (TM) sales skidded 40%, the FT reports, adding that the company will cut production in China by over half and suspend Lexus exports. Non-Japanese car makers have been benefiting from the spat.
Ford (F) breaks ground on a factory in Chongqing in southwest China, where it plans to start making its 2-liter EcoBoost turbocharged engine. Although the country's market is cooling, Ford - and other car makers - see "a tremendous growth opportunity in the middle and the west." Meanwhile, the Chinese government has approved the break up of Ford's JV with Mazda and Chongqing Changan Automobile.
Fiat (FIATY.PK) CEO John Elkann says the company doesn't have any plans to buy into Mazda (MZDAF.PK), but will move forward with the initiative to ups its stake in Chrysler to over 60% from its current level of 58.5% and could link up with an Asian partner. Last week, Fiat and Mazda announced that they will make new models together.
Mazda (MZDAF.PK) and Fiat (FIATY.PK) join forces for the first time with plans to develop a lightweight sports car and explore strategic opportunities in Europe. The linkup between the two automakers leaves Ford (F) with one less partner as a longstanding relationship with Mazda peters out.
Ford (F +0.3%) confirms a $600M investment in its Chongqing plant in China, with the firm making the investment along with JV partners Changan Automobile and Mazda (MZDAF.PK). The plan is to raise annual output by over 50% to 950K units - above expectations of 770K - as Ford looks to boost global sales by almost half to 8M cars a year by 2015.
Japanese shares shoot 2% higher right out of the gate this morning, with the Nikkei Average rising to 9,424 in the first five minutes of trading. Strong U.S. economic data and stock gains overnight help boost Japanese exporters: Toyota (TM +2%), Nissan(NSANY.PK +3%), Mazda (MZDAF.PK +5.6%), Sony (SNE +3%), Panasonic (PC +3%), and Advantest(ATE +3%).
Japanese shares are higher in early trading, as concerns about Europe's economic growth eased. The Nikkei Average is up 0.7% to 8,843 with exporters leading: Mazda (MZDAF.PK +3%), Honda HMC +2%), TDK (TTDKF.PK +2.4%) and Toshiba (TOSYY.PK +1.2%).
Japanese stocks move higher in early trading buoyed by gains in U.S. markets overnight. The Nikkei Average is currently up 0.8% with technology and export shares leading: Sharp (SCPAY.PK +2.2%), Advantest (ATE +3.5%), Mazda (MZDAF.PK +2.4%) and Panasonic (PC +1.1%).
Japanese stocks begin the day lower, despite gains on other Asian bourses and in the U.S. overnight. The Nikkei Average is currently -0.2% to 8,749, with auto-makers and technology shares the leading decliners: Nissan (NSANY.PK -1%), Mazda (MZDAF.PK -1.32%), Honda (HMC -0.5%), Toyota (TM -0.7%), Advantest (ATE -1.5%) and Toshiba (TOSYY.PK -1.1%).