Stan Wong Mercedes-Benz Group ADR MBGYY-OTC WATCH Jan 12, 2023

One of the top luxury brands, sold in nearly every country in the world. Forecast of 150 billion Euros of revenues this year; Europe accounts for 35%, Asia 28% but definitely growing. Improving supply chains, more semis, and China's revival will all help. Shares moved above their 200-day a few months ago. MB is moving more into e-batteries that could challenge Tesla, now with a 6% market share (cars with their e-batteries), but targets all cars by 2030. MB is a value stock trading at 6x earnings, a big discount vs. its history. Shares are outpacing the MSCI world index.

Strong global brand and presence. Customer loyalty. Tradition of innovation. Well positioned to capitalize on growth in Asia. Committed to EV space, by 2030 it wants to be only electric, which could challenge TSLA. 

Affluent customers are not affected by economic downturns, so this type of company is somewhat insulated. Pricing elasticity. Growth rate of high-net worth individuals is growing at 5% a year, faster than mass market growth. Trades at 5.7x earnings, cheap. Raised 2023 earnings guidance. Yield is 7.27%.

Great brand, but he sold, 200-day MA started to tilt downwards. Decline in sales volumes, along with earnings and cashflow. Increasing competition and pricing pressures, particularly in EVs. Softening sales in China, very concerning; Chinese are preferring domestic brands.