Hydrogen Under the Hood at Toyota

This article was originally published by TheStreet and also appeared on Yahoo! Finance

By Sarfaraz A. Khan February 23, 2014

NEW YORK (TheStreet) -- The world's leading automaker Toyota (TM_) is expecting record annual profits due partly to sales and partly to weakness in the yen. Its fuel-efficient hybrid cars continue to grow their already massive sales. In the meantime, while some of the leading vehicle manufacturers have been trying to capitalize on the increasing demand for electric vehicles like those created by Tesla Motors (TSLA_), Toyota on the other hand has been increasing its focus on its hydrogen-powered cars.

On Tuesday, the company reported more than fivefold year-over-year increase in quarterly profits to $5.2 billion. For the full fiscal year, Toyota is targeting net income of $18.8 billion, which would show around 100% increase from net income of $9.5 billion in the previous fiscal year. This would come from sale of 9.98 million vehicles in 2013, more than any other automaker in the world.

Moreover, Toyota plans to retain the crown as the world's best-selling automaker by selling 10.32 million cars in 2014. Some of this increase in sales can be attributed to the popularity of its fuel-efficient hybrid vehicles. They have given a boost to sales in regions like Europe where competitors have struggled.

Despite the positive outlook, Toyota's shares dropped by more than 5% due to the strength of the yen and an expected drop in sales in North America by 30,000 units in the current fiscal year. As a result, Toyota's shares closed at $112.75 on Monday and are trading just 12.9 times their trailing earnings and just 0.85 times their trailing sales.

I believe that is cheap for a blue chip stock with industry-leading sales volume.

Don’t Sell Tesla – Here’s Why

After thoroughly shaking the American automobile industry this year, the electric car maker Tesla Motors (NASDAQ:TSLA) is now out to establish itself in the world’s largest automobile market, China. Meanwhile, the company is eying uptake in production from its California factory as it aims to capitalize on the excess demand. Its recent Q3 report disappointed investors, despite the better than expected performance in terms of revenues and income.

However, its entry in China, its updated production plans, and the expected launch of the Model-E, the mass market vehicle in just 13 months, have shown that the business will continue growing its top and bottom line in the coming quarters. The company is laying foundations for significant growth in domestic and international markets. Read full article at GuruFocus

Ford Could Nearly Double Its Market Share in China by 2015

By Sarfaraz A. Khan and Gohar Yousuf

The U.S. automaker Ford (F) has recently released its U.S. sales numbers for the month of November. Overall sales in the region grew by 7% from prior year to 190,449 units while retail sales rose by 9% to 147,021, which is the highest level for retail sales since November, 2004. Passenger cars sales grew by 6%, while its best-selling pickup in the U.S., the Ford F-Series, delivered another strong performance with a 16% year-over-year increase in sales. In its most recent quarterly results, Ford reported a 12% increase in revenues to $36 billion due to higher sales in the U. S. and Asia Pacific, which offset the decline coming from Europe. In China, the world’s biggest auto market, the company is aiming to increase its market share from 3.2% in 2012 to 6% by 2015. The company will face increasing competition from General Motors (GM) as well as Japanese rivals, but Ford can deliver on its promise due to its massive expansion plans.

Strong Performance In China

Ford was a late entrant to the Chinese market, which is dominated by General Motors as the biggest foreign player in China. By the end of third quarter, Ford enjoyed a ... read full article at GuruFocus