|
Saturday, 06 March 2010 01:31 |
Toyota Motor Corp
Toyota Motor Corp, (TYO:7203, NYSE:TM) has been in the news a lot lately for their car recalls. Basically, many of their vehicles have been victim to faulty accelerators made by a third party part maker. The issue gained widespread media attention when a US police officer experienced unintended acceleration when driving his Toyota car, resulting in fatalities. Since then, they have recalled many of their popular car models, public opinion of their brand has dropped, and there has even been a congressional inquiry.
So what does this mean to you? Well firstly, if you’re a car buyer, then you shouldn’t worry about buying Toyota because after this incident, as they are sure to be doubly stringent on quality control. If you’re an investor on the other hand, you’ll recognise that the brand is very important to the company. Any adverse impact will likely affect sales noticeably. But the extent of the damage won’t be known until a quarter later at the earliest. Before then anyway, the technical picture is positive for the stock. TM has just put in a double bottom with target of $83, quite near the 62% retracement level. Indicators are also pointing up. So whether you’re bearish on Toyota in the long term or not, expect a bounce for the near term at least. By James Lieow
Research & Education Executive of NTU Investment Interactive Club ~disclaimer:The information, statistical data and opinions contained herein are of the author’s own, and have been obtained from sources which he/she believes to be reliable, but it does not represent that they are accurate or complete, and they should not be relied upon as such. All opinions expressed and data provided herein are subject to change without notice. The securities mentioned in this report may not be suitable for all types of investors. ALL investments involve different degrees of risk. You should be aware of your risk tolerance level and financial situations at all times. Read any and all prospectuses carefully before making any investment decisions. As you know, a recommendation, which you are free to accept or reject, is not a guarantee for the successful performance of an investment and we are expressly prohibited from guaranteeing accounts against losses arising from market conditions. NTU-IIC and its members will not be held liable in any manner for any losses arising directly or indirectly from investment decisions undertaken based on the information/statistical data/opinions expressed. |
It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently.
By Warren Buffet