Three European Auto Stocks

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European car companies continue to increase production compared to last year as demands picks up in the domestic and overseas markets. Car makers in European have traditionally built smaller, fuel-efficient cars that are demanded by European consumers. In addition, these companies also reproduce the same strategy when selling in the fast-growing emerging markets such as Brazil, China, India, etc. the demand for small cars is high.

From a July ACEA report:

“New passenger car production in the EU recorded a rebound of 34% three months into the year, compared to the first quarter of 2009. However, production was still 13% down when compared to the first quarter of 2008. The same picture emerged in the segment of vans. Despite a 51% increase three months into the year 2010, production of vans remained 35% below the pre-crisis level of 2008. Truck production decreased by 5% until April this year, and by 63% compared to the first quarter of 2008. The segment of buses declined by 22% three months into the year compared to the same period in 2009.

In units produced, Germany remained the largest auto manufacturing country in the EU (1.4 million units, +33%), while the UK saw its car production pick up most (+72.7%) compared to the first quarter of the previous year. Except for Finland (-59.5%), Belgium (-10.5%), the Netherlands (-7.5%) and Italy (-0.1%), all countries posted growth.”

There are a handful of European car makers that are listed in the US markets.The majority of them are traded on the OTC market. Three of these auto stocks are:

  1. Peugeot Citroen (PEUGY) of France
  2. Fiat (FIATY) of Italy and
  3. Volkswagen (VLKAY) of Germany

Wolfsburg,Germany-based Volkwagen Groups owns the Volkwagen, Skoda, Audi, Seat, Bugatti, Lamborghini, Volkswagen Commercial Vehicles, Bentley and Scania brands. In 2009, the group held 11.3% of the global passenger car market. The company employees 370,000 workers around the world.

The Fiat group is the largest industrial firm in Italy. Europe accounts for just about 35% of total revenues. The company’s stock is listed on the Milan, Paris and Frankfurt exchanges and in the U.S. market thru an ADR program. Some of the car brands owned by Fiat are Fiat, Alfa Romeo, Lancia, Ferrari, Maserati and Abarth.

France-based PSA Peugeot Citroën has gained worldwide reputation for producing environmentally friendly vehicles. The company is heavily expanding in China, Latin America and Russia. Last year the auto maker sold 3,188,000 units worldwide under the Peugeot and Citroën brands.

Knowledge is Power: Dow 1,000?, Poland, Canada Housing Edition

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Marc Faber Questions if Dow Could Hit 1,000

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Pole Position Poland is laying the foundation for a sustainable long-term recovery.

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10 Canadian Dividend Stocks

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The Dow Jones Canada Select Dividend Index represents the leading Canadian stocks by dividend yield. The index contains 30 stocks which are selected annually based on dividend yield.

The divided yield of this index is 4.37% as of July 30th. The annualized total return of the index is 10.65% in Canadian dollar terms. Financials account for about 61% of the total allocation.

The  Top 10 components of the Dow Jones Canada Select Dividend Index are:

1.Canadian Imperial Bank of Commerce(CM)
Current Dividend Yield: 4.82%

2.Bank of Montreal (BMO)
Current Dividend Yield: 4.43%

3.Toronto-Dominion Bank (TD)
Current Dividend Yield: 3.20%

4.National Bank of Canada (OTC: NTIOF)
Current Dividend Yield: 4.11%

5.Telus Corp (TU)
Current Dividend Yield: 4.92%

6.Bank of Novo Scotia (BNS)
Current Dividend Yield: 3.70%

7.Manitoba Telecom Services Inc (OTC: MOBAF)
Current Dividend Yield: 9.84% *

* Note: Manitoba cut its dividends by a third on August 6th and also lowered the outlook

8.Royal Bank of Canada (RY)
Current Dividend Yield: 3.72%

9.IGM Financial Inc(OTC: IGIFF)
Current Dividend Yield: 4.97%

10.Canadian Utilities Ltd(OTC: CDUAF)
Current Dividend Yield: 3.46%

Montreal-based National Bank of Canada is the 6th largest bank in Canada. The bank operates most of its branches in the French-speaking province of Quebec.

Time to Invest in Indonesia?

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Indonesia has been recently discovered by international investors as an attractive destination for investment. Yesterday’s NY Times had an article highlighting Indonesia’s growth story. From the article titled Indonesia Takes on an Attractive Sheen:

“JAKARTA — After years of being known for inefficiency, corruption and instability, Indonesia is emerging from the global financial crisis with a surprising new reputation — economic golden child.

 

 

The New York Times

The country’s economy, the largest in Southeast Asia, grew at an annual rate of 6.2 percent in the second quarter of this year, data released Thursday showed. That is an acceleration from 2009, when gross domestic product expanded 4.5 percent.

The stock market hit a record high last week and has been among the best-performing equities markets in Asia this year, rising more than 20 percent since Jan. 1. The country’s currency, the rupiah, has appreciated nearly 5 percent this year against the dollar, among the strongest showings in Asia besides that of the yen.

Foreign direct investment, which was held in check for years after the 1997 economic crisis in Asia, is also returning. The country had 33.3 trillion rupiah, or $3.7 billion, in foreign direct investment in the second quarter of this year, a 51 percent rise from a year earlier, the Investment Coordinating Board in Indonesia said last week. The country is on track to attract more foreign investment this year than it did in 2008, when it lured in $14.87 billion.

Such statistics have some here cautiously saying that the country, a Muslim-majority democracy and one of the world’s most populous countries, could soon merit the kind of attention that investors now lavish on China and India.

“Indonesia is one of the most interesting, most attractive destinations in the world,” said Lanang Trihardian, an analyst at Syailendra Capital, a fund management firm based in Jakarta. “Foreign investors have been flowing to Indonesia from maybe around mid-2009. We are seeing a lot of liquidity coming into Indonesia, and it is mostly going to capital markets, to bonds, to stocks.””

Last December I wrote an article on some of the reasons for investing in that Asian country.

Some of the ways to invest in Indonesia are:

Van Eck Market Vectors Indonesia ETF (IDX)
Closed-end Fund – Aberdeen Indonesia (IF)

In one year IF is up over 51%.

PT Telekomunikasi Indonesia (TLK) is the only Indonesian company that trades on the NYSE as an ADR. Known as TELKOM, it provides a full range of telecom services in the country. Currently the stock pays a dividend yield of over 3%.

Forbes: The World’s Most Valuable Brands 2010

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Forbes magazine published the list of World’s 50 Most Valuable brands recently. Hi-tech firm Apple Computers (AAPL) tops the list with a brand worth of $57.4B. Software company Microsoft(MSFT) followed Apple to take the second place.

The top 10 brands from the ranking are listed below:

[TABLE=524]

Among the top five tech companies occupy four spots. The non hi-tech brands in the top 10 included Coca Cola (KO), McDonald’s (MCD), Marlboro of Altria(MO) and GE (GE). Cell phone maker Nokia (NOK) of Finland is the only non-US company in the top 10 list.

The full list of  Forbes magazine’s World’s Most Valuable Brands can be found here.