karthikpm Posted March 16, 2015 Share Posted March 16, 2015 What's driving this monster rally in FCAU? I had pegged my estimate of IV around 18 , 2 yrs ago. How much has the spin off of ferrari changed the valuation ? Does anyone have new models for valuing FCAU ( the original assumption was Sum of Parts)? Link to comment Share on other sites More sharing options...
krazeenyc Posted March 16, 2015 Share Posted March 16, 2015 What's driving this monster rally in FCAU? I had pegged my estimate of IV around 18 , 2 yrs ago. How much has the spin off of ferrari changed the valuation ? Does anyone have new models for valuing FCAU ( the original assumption was Sum of Parts)? I'm quite bullish. FCAU has been my largest position by far since June 2013. But I've been selling down recently -- I first sold 25% around 15.5 (I guess too early?) and this morning I just sold another 25%. I think the combination of the Ferrari IPO at an 7-8 Billion Euro Valuation plus a potential sale or merger of the rest of the business has people excited. Whoever bought on the weakness created by the shorting by the convertible note buyers did quite well in a very short time. Link to comment Share on other sites More sharing options...
simplefocus Posted March 16, 2015 Share Posted March 16, 2015 I view FCAU more as a growth stock with the margin of safety in the sum of all parts. If they're successful in executing their 5 year plan, this is an easy $30 stock in 1-3 years. Yes I'm quite bullish and this is my largest position. Link to comment Share on other sites More sharing options...
Guest notorious546 Posted March 16, 2015 Share Posted March 16, 2015 What's driving this monster rally in FCAU? I had pegged my estimate of IV around 18 , 2 yrs ago. How much has the spin off of ferrari changed the valuation ? Does anyone have new models for valuing FCAU ( the original assumption was Sum of Parts)? Milan-listed shares in Fiat Chrysler Automobiles <FCHA.MI> rise more than 3 pct to their highest since July 1998, and up for fourth straight day ** Rally attributed to declarations by the carmaker's chief executive who said a tie-up with GM <GM.N> or Ford <F.N> would be "technically feasible" ** CEO Sergio Marchionne adds in the same interview with Bloomberg that there was "nothing substantive" on the table ** Fiat shares are the top traded across Europe with more than $420 mln traded so far on the day ** Traders say comments lifting the stock as they bring closer the possibility of further consolidation in the sector that would help cut capital costs -- something Marchionne has advocated for years ** However, analysts say a tie up between FCA and any of its two U.S. rivals would be difficult ** "A business combination with FCA would be a total reverse of Ford's ONE Ford strategy which has seen the company streamline its brands, platforms and products over recent years," Evercore ISI analyst Arndt Ellinghorst says in a note ** He adds that GM's appetite would be similarly limited given improving performance in North America and already strong presence in South America, Europe and China ** Fiat shares up more than 60% this year, the 2nd best performer on the STOXX 600 <.STOXX> Link to comment Share on other sites More sharing options...
krazeenyc Posted March 16, 2015 Share Posted March 16, 2015 I view FCAU more as a growth stock with the margin of safety in the sum of all parts. If they're successful in executing their 5 year plan, this is an easy $30 stock in 1-3 years. Yes I'm quite bullish and this is my largest position. I think this, change in sentiment, is partly why the stock has done so well so quickly. FIAT was for so long considered to be total crap -- I still have a handful of European analyst reports with target prices of 5-6 Euros a share from 2014. If the Ferrari IPO was not in the works and the stock were trading here, I would've certainly sold my entire position by now -- maybe I still should (but I almost always sell too early). Link to comment Share on other sites More sharing options...
Phaceliacapital Posted March 16, 2015 Share Posted March 16, 2015 Efficient market my ass.. If you ponder about the SOTP, what about a closer look at Jeep. You're talking about 1 mn units, for what, an ASP of 30.000? So around 30 bn or roughly 30% of revenues are coming from Jeep. SUVs typically have a higher margin profile than non-SUVs, but still lower than pickup trucks. Let's say they Jeep can do EBIT of 6% (local production China, EU production Renegade for sale in US at very nice dollar exchange rate). Gives you around 1.8 bn in EBIT, what kind of multiple do you put on that? 6x ? 7x? Link to comment Share on other sites More sharing options...
karthikpm Posted March 16, 2015 Share Posted March 16, 2015 I view FCAU more as a growth stock with the margin of safety in the sum of all parts. If they're successful in executing their 5 year plan, this is an easy $30 stock in 1-3 years. Yes I'm quite bullish and this is my largest position. I think this, change in sentiment, is partly why the stock has done so well so quickly. FIAT was for so long considered to be total crap -- I still have a handful of European analyst reports with target prices of 5-6 Euros a share from 2014. If the Ferrari IPO was not in the works and the stock were trading here, I would've certainly sold my entire position by now -- maybe I still should (but I almost always sell too early). $ 30 is pretty bullish ( Greenwood investors also has a similar valuation). I always sell early and I agree with krazeenyc that Ferrari IPO has been a game changer for the stock. I will probably do some tax lot selling if the stock runs up more. It's close to my IV and I will trim above 17-18. Selling is way harder than buying Link to comment Share on other sites More sharing options...
simplefocus Posted March 16, 2015 Share Posted March 16, 2015 I did trim about 8% earlier this month but it's still my largest position. As long as Marchionne at the helm, I will hold on to my shares. This guy is amazing! Link to comment Share on other sites More sharing options...
zizou Posted March 17, 2015 Share Posted March 17, 2015 Curious if anyone is able to estimate the effect of EURUSD drop on FCAU? Their expenses in EUR vs sales in USD must work to their advantage quite a bit. Link to comment Share on other sites More sharing options...
compounding Posted March 17, 2015 Share Posted March 17, 2015 Curious if anyone is able to estimate the effect of EURUSD drop on FCAU? Their expenses in EUR vs sales in USD must work to their advantage quite a bit. Don't forget the debt. Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted March 17, 2015 Share Posted March 17, 2015 http://autos.jdpower.com/content/blog-post/SOPdyIU/february-2015-auto-sales-all-but-two-automakers-post-sales-increases.htm Fiat Chrysler Automobiles (FCA)--Across all of its brands, FCA increased its sales by 5.4%. Maserati, which had enjoyed a year of triple-digit sales increases throughout 2014, declined in February by 42.5%; Dodge and Fiat were also down, although less so. Jeep showed the biggest improvement in sales--21.1%--with Chrysler brand gaining 13.0% and Ram up 11.5%. Link to comment Share on other sites More sharing options...
zizou Posted March 17, 2015 Share Posted March 17, 2015 Curious if anyone is able to estimate the effect of EURUSD drop on FCAU? Their expenses in EUR vs sales in USD must work to their advantage quite a bit. Don't forget the debt. Is majority of their debt issued in EUR or USD? I thought it would be in EUR mostly.. but maybe Chrysler has USD debt. Link to comment Share on other sites More sharing options...
compounding Posted March 17, 2015 Share Posted March 17, 2015 Curious if anyone is able to estimate the effect of EURUSD drop on FCAU? Their expenses in EUR vs sales in USD must work to their advantage quite a bit. Don't forget the debt. Is majority of their debt issued in EUR or USD? I thought it would be in EUR mostly.. but maybe Chrysler has USD debt. Majority in non-USD. The USD bonds are the ones with covenants that are the reason for the ring fencing around the Chrysler balance sheet (restricting the cash flow to FCA), callable in June 2015 and 2016 if I remember the dates correctly. Refinancing those bonds will also lower interest expense. It's in the 10-k. They are hedged against currency risk though to the degree of being hedged for approximately 85% of annual turnover, if I understand it correctly. If anyone can figure out what this means in actual money, be kind to let us know. Couldn't find a sensitivity analysis in either the 2014 or 2013 annual report. Pretty sure this will be addressed in the Q1 presentation if not before then. Sergio recently said that 1.10 EUR/USD would "be a dream" so I guess it has some positive impact. For instance, it's possible that vehicles built in Europe and exported aren't fully hedged as i could imagine it depends on the demand for those vehicles, and to where they are exported. Link to comment Share on other sites More sharing options...
fareastwarriors Posted March 25, 2015 Share Posted March 25, 2015 Auto Workers’ Medical Benefits at Risk Under New Tax UAW, Big Three must decide who will pick up tab for tax on high cost health plans http://www.wsj.com/articles/auto-workers-medical-benefits-at-risk-under-new-tax-1427220418 Link to comment Share on other sites More sharing options...
simplefocus Posted March 29, 2015 Share Posted March 29, 2015 Ferrari's Vettel storms to Malaysia win http://news.yahoo.com/ferraris-vettel-storms-victory-malaysia-090755605--f1.html Link to comment Share on other sites More sharing options...
nikhil25 Posted April 1, 2015 Share Posted April 1, 2015 March Sales meet expectations: http://www.reuters.com/article/2015/04/01/us-autos-sales-march-idUSKBN0MS4BB20150401 (Reuters) - Fiat Chrysler Automobiles (FCHA.MI)(FCAU.N) on Wednesday said U.S. vehicle sales rose 2 percent in March, meeting analysts' expectations. It was the 60th consecutive month of year-to-year gains for the company, dating to March 2010. FCA, the first of the major automakers to report monthly sales on Wednesday, said its Jeep and Chrysler brands had double-digit gains, while the Dodge and Fiat brands fell from a year earlier. Ram sales were flat. The company sold 197,261 vehicles in March, compared with 193,915 a year earlier. Link to comment Share on other sites More sharing options...
nikhil25 Posted April 3, 2015 Share Posted April 3, 2015 Jury finds Chrysler responsible for death of boy in Jeep crash http://www.bloomberg.com/news/articles/2015-04-02/fiat-loses-150-million-verdict-in-boy-s-jeep-tank-fire-death Link to comment Share on other sites More sharing options...
fareastwarriors Posted April 3, 2015 Share Posted April 3, 2015 Jury finds Chrysler responsible for death of boy in Jeep crash http://www.bloomberg.com/news/articles/2015-04-02/fiat-loses-150-million-verdict-in-boy-s-jeep-tank-fire-death It's tragic for the boy and family but am I the only one who thinks $150m is a crazy number? Link to comment Share on other sites More sharing options...
muscleman Posted April 4, 2015 Share Posted April 4, 2015 Jury finds Chrysler responsible for death of boy in Jeep crash http://www.bloomberg.com/news/articles/2015-04-02/fiat-loses-150-million-verdict-in-boy-s-jeep-tank-fire-death It's tragic for the boy and family but am I the only one who thinks $150m is a crazy number? "By the time the deal was reached, 75 people had died in accidents involving Jeep fuel tank fires since 1998". So if each person gets 150 million, FCAU is going to take a 11 Billion hit. Link to comment Share on other sites More sharing options...
phil_Buffett Posted April 4, 2015 Share Posted April 4, 2015 if is the word. nothing more. unimportant. they will make an Appeal for sure. 150mio is a joke. way to much. even if they get more lawsuits. and until the lawsuits are settled Sergio has before sell the Company to Renault or vw. to pick a Company, i would say it is clearly vw. a few other Players could it be as well. but vw will buy it. piech who sees himself like the god would be very stupid to let this Chance go into Renault Hands. he is almost 80 is one of the greediest Person alive but also very intelligent and has a lot of Patience. he was a collector of car companies, and now he would let this Card go to a other Hand? never!! in the end it will be VW. Sergio says no contact to VW. this is Sergio. a poker Player. vw will come to him with the right Price. piech has the Chance to get maserati, Jeep, dodge, alfa, fiat and so on. he will get his trophy´s also vw Needs it. chrysler and Jeep for the us presence which is almost Zero. maserati as another great premium brand, alfa to rebirth with a great vw Franchise System around the world. Link to comment Share on other sites More sharing options...
cmlber Posted April 6, 2015 Share Posted April 6, 2015 Jury finds Chrysler responsible for death of boy in Jeep crash http://www.bloomberg.com/news/articles/2015-04-02/fiat-loses-150-million-verdict-in-boy-s-jeep-tank-fire-death It's tragic for the boy and family but am I the only one who thinks $150m is a crazy number? "By the time the deal was reached, 75 people had died in accidents involving Jeep fuel tank fires since 1998". So if each person gets 150 million, FCAU is going to take a 11 Billion hit. All the articles refer to those 75 people, but none of them note that Fiat is only liable for injuries that occurred after the 2009 bankruptcy, and in no case can be liable for punitive damages relating to a defective vehicle sold before 2009. The number of those cases is much smaller. And this case happened to be an incident where there were no injuries from the crash, so it's easy to prove the fire was the cause of death, and not the other driver's recklessness. I would guess of those 75, most of them were pretty horrible accidents where it's not as clear if the fire was the only cause of death. Still pretty bad news for FCAU, and the story is tragic, but the press on this doesn't tell the whole story from a legal perspective. Link to comment Share on other sites More sharing options...
brker_guy Posted April 7, 2015 Share Posted April 7, 2015 Interesting hire: http://www.engadget.com/2015/04/06/elon-musk-hires-an-f1-expert-to-revolutionize-teslas-pit-stops/?ncid=rss_truncated Link to comment Share on other sites More sharing options...
nikhil25 Posted April 8, 2015 Share Posted April 8, 2015 Fiat Chrysler launches $3 billion bond offer http://www.reuters.com/article/2015/04/08/fiatchrysler-debt-idUSI6N0WK01M20150408 Link to comment Share on other sites More sharing options...
Phaceliacapital Posted April 9, 2015 Share Posted April 9, 2015 Very good. Link to comment Share on other sites More sharing options...
nikhil25 Posted April 13, 2015 Share Posted April 13, 2015 DEALTALK-Fiat Chrysler CEO seeks mega deal before stepping down http://www.reuters.com/article/2015/04/13/fiatchrysler-ma-idUSL6N0WT3F720150413 * FCA wants alliance to jumpstart sector consolidation * Needs merger to fix own operational weaknesses * Carmaker focused on partner in U.S. market, sources say * FCA keen on GM, but the U.S. firm not interested, sources say Link to comment Share on other sites More sharing options...
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