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FCAU - Fiat Chrysler Automobiles


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Marchionne is the number one,

 

He dreams with the merger and gradually hi is putting everybody agree.

 

At the moment already has convinced the leader of the union, 

 

Now he wants shareholders to get involved. He said this when he presented the “Capital Junkie” presentation in 1Q15.

 

He wants analysts and shareholders to get involved.

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http://frenzel-herzing.com/dhando-investor-meeting-2015-a-day-with-mohnish-pabrai/

 

mohnish about fiat

 

4.Pabrai thinks that Fiat is highly undervalued. Minimum margin of safety is 50% and it has the potential to become a +4x. The spinoff of Ferrari will come in less than a month and it is still not considered in the share price.

 

The value of the Ferrari spinoff will exceed the initial purchase price of the entire position. In his opinion Fiat will not drop that much after Ferrari is spinout of Fiat. He thinks that Fiat should be at least valued 2x or even more.

 

 

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http://frenzel-herzing.com/dhando-investor-meeting-2015-a-day-with-mohnish-pabrai/

 

mohnish about fiat

 

4.Pabrai thinks that Fiat is highly undervalued. Minimum margin of safety is 50% and it has the potential to become a +4x. The spinoff of Ferrari will come in less than a month and it is still not considered in the share price.

 

The value of the Ferrari spinoff will exceed the initial purchase price of the entire position. In his opinion Fiat will not drop that much after Ferrari is spinout of Fiat. He thinks that Fiat should be at least valued 2x or even more.

 

Is this at the current price, FCAU has a 50% MOS or when he bought the stock?

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http://frenzel-herzing.com/dhando-investor-meeting-2015-a-day-with-mohnish-pabrai/

 

mohnish about fiat

 

4.Pabrai thinks that Fiat is highly undervalued. Minimum margin of safety is 50% and it has the potential to become a +4x. The spinoff of Ferrari will come in less than a month and it is still not considered in the share price.

 

The value of the Ferrari spinoff will exceed the initial purchase price of the entire position. In his opinion Fiat will not drop that much after Ferrari is spinout of Fiat. He thinks that Fiat should be at least valued 2x or even more.

 

Is this at the current price, FCAU has a 50% MOS or when he bought the stock?

 

i would suspect at the actual Price Level. right now in my opinion fiat is big time undervalued.  8)

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This VW diesel thing looks to be turning into a big problem and stock is down again. Some reports say the car would only turn on environmental filtering when it was being tested and off for regular driving and emissions would be over 40 times the legal limit. A friend of mine just bought a VW Golf and was loving it due to great fuel economy and good performance while being environmentally friendly - I wonder what happens to her car now.

 

FCAU down about 6% this morning as all the European auto makers have diesel engines and I would think people are selling first instead of waiting to see if this spreads. Trying to figure out how much diesel FCAU sells - they do have some Jeep and Dodge trucks in the US, but Europe is the big diesel market.

 

The upside of this is it may actually help Marchionne with his push for industry consolidation.

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http://www.reuters.com/article/2015/09/22/us-fiatchrysler-us-defeatdevices-idUSKCN0RM1MK20150922

 

So, the VW trouble could actually bode well for FCAU market share

 

FCAU's diesel technology either comes from cummings for trucks or GM during the ventures before the 2002 break up.

If FCAU's diesel engines are good, then likely GM's diesel engines have no problems either.

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Question on FCAU options.  Does anyone know what adjustments to the options will be made, if any, after the Ferrari IPO?  I have some Jan 2017 deep in the money calls....wonder how they will be adjusted?

 

I would think either the strike would be lowered by some amount, or there would be Ferrari options issued.  If its the latter, they might have a higher volatility premium since I assume Ferrari will trade in a large-ish range for the first few days/weeks as the market figures out how to price it...

 

Any thoughts?

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Question on FCAU options.  Does anyone know what adjustments to the options will be made, if any, after the Ferrari IPO?  I have some Jan 2017 deep in the money calls....wonder how they will be adjusted?

 

I would think either the strike would be lowered by some amount, or there would be Ferrari options issued.  If its the latter, they might have a higher volatility premium since I assume Ferrari will trade in a large-ish range for the first few days/weeks as the market figures out how to price it...

 

Any thoughts?

 

For significant disposition like this, the call option holder will be entitled to purchase the same number of FCAU/Ferrari shares as a stockholder who has held the shares pre-spinoff.  For example, if each share of FCAU gets 0.2 shares of Ferrari, then when/if you exercise your 2017 option you will get, for each contract, 100 FCAU shares and 20 Ferrari shares in exchange for your (unadjusted) exercise cost.

 

 

 

 

 

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pretty soon ferrari spinoff and this stock goes down every day more :D. only because of the scandal. pretty frustrating right now. the stock Performance.

 

Sergio will of course talk the last days more with gm, wow if the would Change their mind and make a Merger, vw would be absolutely fucked up. more than now.  :o 8)

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pretty soon ferrari spinoff and this stock goes down every day more :D. only because of the scandal. pretty frustrating right now. the stock Performance.

 

Sergio will of course talk the last days more with gm, wow if the would Change their mind and make a Merger, vw would be absolutely fucked up. more than now.  :o 8)

 

The volatility has been nice. I've been trading 1/4 of my position since early Summer. Buying as it dropped and selling as it rose. Have managed to get somewhere around an additional 25% which would reduce my average cost by about 6% on the whole position. Have also had success selling far out of the money calls against the position when prices were really volatile to tack on another 1-2%. My # of shares is now the same as it was at the beginning of the summer, but my cost basis for the entire position is essentially 7-8% lower. Works out especially well since they're in my Roth IRA and none of the transactions will be taxed. .

 

Separate from the strategy above, I've been selling puts to collect a premium on my cash position. Looks like some of those might get exercised in October if we keep moving this direction though so my position will likely increase going into the spin-off.

 

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I've also traded in and out, about 66% of my total position size which is rare for me but I felt I had a much stronger handle on this company vs others. Fiat is probably my most researched/read about position of the last 3 years which gave me the comfort to do so. I was a seller @ 16 and would like to be a buyer @ 12.xx

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