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Has Toyota (NYSE:TM) Found A Real Low?

|Includes: F, Toyota Motor Corporation (TM)

Toyota Motors (NYSE:TM) has been on the hot seat recently. Toyota issued a massive recall due to an accelerator problem. This recall has affected millions of vehicles and the owners of theses vehicles. Politicians and federal investigators have made statements about the recall from Toyota as the company is in the news every single day.

On January 15th, 2010 the stock made a new high for the year at nearly 92.00 a share. Since that time the stock has declined to 71.00 on February 4th, 2010. From peak to trough this is a 21 point decline in just 3 trading weeks. While the stock has fallen sharply from these levels they still maintain a lot of market share globally.

Currently Toyota Motors as a stock is under pressure. Many other car companies are trying to capitalize on the negative news from the market leader Toyota. Ford Motors (NYSE:F) is one stock that has traded higher on the back of a falling Toyota stock. Ford has surged over ten fold and nearly 11.00 points throughout 2009 since it's February 2009 lows. From a traders point of view most of the good news looks baked into the cake for Ford.

So what is a better buy here, Ford or Toyota? Throughout history, it is hard to knock off the king. Toyota Motors is still the king. Companies have had recalls before and they seem to always pull through. Toyota is looking attractive at these levels. Remember the market always overshoots much the same way that a pendulum does. Often it goes to an extreme high and then to an extreme low. The same case can be made for a stock. Therefore, keep an eye on Toyota Motors at these levels.

Nicholas Santiago
Chief Market Strategist