Opinions Mark Grammer
Bayerische Motoren Werke AGBMW.DETOP PICKMar 22, 2018
Mark GrammerStock price when the opinion was issued
As of Aug 29, 2024. Market Open.
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Dividend bounces around, but between 5-9% over last few years. World-class name. Auto industry has been depressed for a decade, but now coming back. Politicians are hammering less on EVs. Elon's burned his bridges with the luxury consumer; Teslas will disappear, and BMW and Mercedes will come back. He sold to buy a bit more NVDA.
Trades at 6x earnings. Even through pandemic, increased production and sales slightly. Upper-end brand name. Consumer's down and so is China, but you'll see activity once that turns. Wealthy in China are still increasing, and that's a big market for them. EV offering is better than TSLA's. Yield is 7.26%.
(Analysts’ price target is $44.70)
Bruce Murray
Bruce MurrayBruce Murray
The traditional car makers have finally made moves to catch up to Tesla. In one of the best positions to benefit from cyclical and secular trends. Margins are improving, leading to a higher stock multiple. Yield is 2.30%. (Analysts’ price target is $84.65)
Jamie Murray (A Top Pick Jul 24/18, Down 18%) Auto stocks have remained out of favour longer than he thought, despite this stock having a good dividend. The Chinese market turned down sharply, following comments from President Trump. There is nothing wrong with the company. He expects them to manufacture more e-vehicles than Tesla this year. Yield 5%
Bruce MurrayBruce Murray
A global luxury brand. Selling at 6x earnings. Trump is punishing this company, but BMW will be around long after him. (Analysts' price target: Euros 97.18)
Bruce Murray
The street hates BMW right now. Many analysts say BMW’s margins are too high and will come down. He says that BMW has sustained its high margins for a long time. Also, BMW is very strong in diesel and there is a perception that diesel is dirty. The Volkswagen scandal did not help. BMW and Mercedes put filters on that reduce particulate emissions significantly, so they are being tainted with an inappropriate brush. Opportunities for BMW are very good in the US, Europe and China. They build many SUV’s in the US, which will help protect them from Trump. (Analysts’ price target is 96.54€)