Author Topic: FCAU - Fiat Chrysler Automobiles  (Read 1043592 times)

rolling

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Re: FCAU - Fiat Chrysler Automobiles
« Reply #3020 on: January 02, 2020, 08:30:55 AM »
You guys are coming up with a value of about $35 to $40 in 5 years or about $25 now.

But, as per the new 4 year plan earnings are supposed to be €5.9 to €7.3 per share in 2022.

Even if (a pretty big IF) Fiat gets to only €5.0 ($6) and at 5 PE it would be worth $30 within 2-3 years. And arguable more.

So how is the merger more attractive than being standalone, given all the additional risks that come along?

Vinod
What story makes most sense?
1- fcau getting those earnings as a standalone
2- synergies and scale from merger

I think the 2nd one especially because:
A) option 2 does not exclude option 1 possibility (those earnings can go right and you still get 50% of those plus the extraordinary dividends)
B) estimated synergies do not include factory closings. If a recession comes, those "unplanned" synergies will materialize even if those 3.7B turn out to be lower. If a recession comes, least efficient factories will probably close.

So my take is: significant de-risking and higher (real) upside.
My usual portfolio: Highly concentrated (up to 3 or 4 positions) in smallcaps and microcaps.


RadMan24

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Re: FCAU - Fiat Chrysler Automobiles
« Reply #3021 on: January 02, 2020, 06:46:07 PM »
I mean, operationally, you will have a guy who turned GM Europe from a loss maker of 20 years to $1 billion EBIT in 9 months.

Carlos Tavares is the best operator in the business, now at the helm (in 12 months or so). It's worth to see how this plays out in my opinion.



DTEJD1997

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Re: FCAU - Fiat Chrysler Automobiles
« Reply #3022 on: February 11, 2020, 08:49:55 AM »
Hey all:

FCAU came out with earnings the other day.

Seems to be a slight let down.  Apparently they were $.02/share off of what was expected and the stock promptly went way down.

Would be interesting to see/know the balance sheet and what the status is of the robotics division sale.

I think TSLA is sucking all the oxygen & attention out of the automotive area.

Anybody else still in FCAU or has everybody liquidated and moved to TSLA?

rkbabang

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Re: FCAU - Fiat Chrysler Automobiles
« Reply #3023 on: February 11, 2020, 09:09:33 AM »
Hey all:

FCAU came out with earnings the other day.

Seems to be a slight let down.  Apparently they were $.02/share off of what was expected and the stock promptly went way down.

Would be interesting to see/know the balance sheet and what the status is of the robotics division sale.

I think TSLA is sucking all the oxygen & attention out of the automotive area.

Anybody else still in FCAU or has everybody liquidated and moved to TSLA?

I haven't sold FCAU yet to move to TSLA.   Maybe if TSLA ever hits $1000/share I'll sell FCAU and everything else and go all in.

RadMan24

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Re: FCAU - Fiat Chrysler Automobiles
« Reply #3024 on: February 11, 2020, 10:57:32 AM »
FCF was underwhelming due to electric vehicle spend. 2021-2022 with merger synergies is what will propel this investment up. Otherwise, it’s a waiting gamw.

DCG

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Re: FCAU - Fiat Chrysler Automobiles
« Reply #3025 on: March 16, 2020, 07:11:48 AM »
Stock is getting destroyed on the announcement that they're ceasing all production for now.

TwoCitiesCapital

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Re: FCAU - Fiat Chrysler Automobiles
« Reply #3026 on: March 16, 2020, 08:03:38 AM »
Thinking about buying more but am curious - at this point can the boards cancel the aforementioned special dividends to shore up liquidity? I don't see the special dividend/merger up for vote on the docket @ the April meeting suggesting to me that they're already approved, but honestly would rather they both hold onto the cash for now and distribute at a later date.

Secondly, I know option strike prices aren't updated for "regular dividends" and are for "special" dividends. Does anyone know if an annual dividend qualifies as "regular" or "special" when it comes to adjusting options strikes?  Am considering rolling back into LEAPS to free up liquidity but want to understand what that means for the April dividend.

Thanks!
« Last Edit: March 16, 2020, 08:07:43 AM by TwoCitiesCapital »

ukvalueinvestment

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Re: FCAU - Fiat Chrysler Automobiles
« Reply #3027 on: March 16, 2020, 08:06:21 AM »
It was just a memorandum of understanding and, yes, I wouldn’t be surprised if dividends are cancelled in the medium term.
@ukvalueinv

nikhil25

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Re: FCAU - Fiat Chrysler Automobiles
« Reply #3028 on: April 05, 2020, 03:05:12 PM »
How are folks thinking about long-term effects to the auto industry?

The demand side will likely get deeply affected if a recession persists for a while since consumers will focus on cash preservation and avoid making big-ticket purchases. The supply side is obv affected with disruptions in the global supply chain and manufacturing facilities going offline. OEMs with financing arms will also see default rates go up.

That said, as countries recover from CoVid-19, part of me feels we might see an uptick in new car purchase intent. I'm assuming the lack of trust in public transportation (both safety and scarcity during times of need) might lead to an increase in demand from folks who don't own a car today.

Edward

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Re: FCAU - Fiat Chrysler Automobiles
« Reply #3029 on: April 06, 2020, 05:41:34 AM »
How are folks thinking about long-term effects to the auto industry?
A horrible industry since the 70's. There are short-medium term opportunities such as:
https://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/rno-renault-sa/

But otherwise I would avoid like the plague. It's that bad. Even in relatively "good" times.

When the industry consolidates significantly, maybe it would make a bit of sense, and even then it is still a hugely cash consuming, labor union happy, investor soul crushing industry. :)