Toyota Becoming a Mutual Fund Favorite

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Includes: GM, TM
by: Steven Towns

Yesterday's Wall Street Journal featured Toyota Motor Corp (NYSE:TM) in its Mutual Funds Monthly Review insert in the "Question of the Month" subsection (June 3rd print edition p. R10). Unsurprisingly Toyota is becoming a hot holding but I wonder how much of a retreat from its recent peak the fund managers can take.

Here are some of the interesting points from the WSJ article and I can understand if any readers are tired of the comparisons to GM but it's still amazing to see the divergence of courses.

• Since the end of '04 General Motors' shares are down 34% vs. a 47% gain by Toyota

• Toyota's market capitalization at nearly $180 million is about 12x that of GM

• Including affiliates both GM and Toyota have about 13% of the global auto market share

• Two California companies (Capital Research & Management and Barclays Global Investors) are the second and third largest owners of Toyota's ordinary shares (Tokyo: 7203)

• Other top-10 owners from the U.S. include: Fidelity and Wellington Management.

• Aside from Asia/Japan specialized funds, 79 U.S. diversified mutual funds owned shares of Toyota's American Depository Shares (ADSs) -- more than double last year.

• Funds that have made outsized bets on Toyota ADSs: CGM Advisor Targeted Equity Fund, Marsico Capital Management, Ariel Focus Fund, Legg Mason Classic Valuation Fund, and Turner Concentrated Growth Fund.

The WSJ quoted Scott Kuensell of Brandywine Asset Management, which manages the above mentioned the Legg Mason fund who said:

"It's one of the best companies I've ever researched. It's not only a great company with sound strategic planning [and] extremely strong financials, but it happens also to be operating in an industry where some of their major competitors are not very strong companies."

Toyota & GM 1-yr stock chart comparison:

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Tagged: , Auto Manufacturers - Major,
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