Magna Int'l. (A) (MG.TO)

(Market Call Minute) Model price of $87.55, a 64% upside. But the market does not really believe it. Until he sees a really good bottom he won’t be back in.

Has avoided auto stocks because of the volatility they have shown in the past. This is a volatile industry. This has been a well-run company and they have done well in Europe.

Not one he would look at. Would like to see it improve both in the ranking on a fundamental basis, but also in its relative strength. He is not seeing either of these. Longer-term, it is going to be a strong growth business.

Has a tough time buying the “peak auto” theory. A lot of parts manufacturers are able to grow regardless of how many cars they make in the US. This has come off quite a bit and valuations are compelling. Believes the economic data is at least going to muddle along. Sees nothing but upside in these names going forward.

Shares rebounded a bit, but what is hurting auto parts manufacturers is the moderating effect of US auto sales. MG-T are trying to push more content to each individual car. He is neutral on the shares.

Since the financial crisis of 2009, this has done really well, as has car sales. His concern is that there has been a lot of extended term lending on cars, and that could really come down in a negative way. He would be cautious.

(A Top Pick May 14/15. Down 16.74%.) It swooned because of the trade agreement we had and people’s concerns about auto sales. Currently it is dirt cheap. Thinks there is great, great value here. Still a Hold. Dividend yield of around 4%.

This is a play on having no recession on the horizon and that we are still not at peak auto. Trading lower than its five-year average. Have a very under levered balance sheet. Expects a lot of dividend growth and share buyback. Sees earnings per share growing at around 15% annually over the next couple of years. Dividend yield of 2.37%, which he expects will grow at 6%. They benefit from a softening US$.

Sold his holdings a little over a year ago. His primary concern is that we are getting towards the end of the auto cycle. Sub prime auto loans of about $27 US billion last year, had delinquencies near a 20-year high at around 5%, indicating people are having a harder time meeting some of their obligations.

How strong is the average US consumer going to be over the next few years. Non performing auto loans are starting to become questionable. Auto loans are the new housing sector in the US where a lot of people really can’t afford their cars. The risks in the auto sector in the US are really too high. MG-T will be the one to own after the trend changes and the bottom is in. There is another down leg coming to the auto sector.

This is reasonably well positioned, although he hasn’t done the research on it. If you look at the way the industry is going, this company is very well positioned. Dividend yield of 2.4%.

(Top Pick Apr 16/15, Down 14.92%) They struggled, down double digits. It is a more conservative way to play the auto sector. It is cheap, but he is not pounding the table. He still likes and is buying this name. It looks like it has broken its downtrend.

On her watch list. The concern is that auto production has peaked. It has probably stabilized here and you will see more modest growth. VW is a major customer of theirs and will hamper margin improvement in Europe. Potentially she could buy shortly.

Probably one of the biggest car parts Company in the world. A “go to” name for people who want to bet on the car sales. There are still a lot of old cars rolling around in North America, so car sales should do okay. If you are willing to bet on increased car sales in an OK economy, this is a good name to be in.

One of the biggest auto parts supplier in the world. In the last few years, new management consolidated their position in North America and Europe. Recently did an acquisition to get exposure in China, which is probably why the stock has been hit, as well a view that this is the peak in the auto cycle. That view is premature, although in a couple of years that might well be the case. Very cheap trading at 5-5.5 times EBITDA. Dividend yield of 2.55%.