Saturday, May 7, 2016

Analysis of VW 2016


VW, a German automobile producer

Company: Volkswagen 

ISIN DE0007664039 | WKN 766403 

Business: A German automobile manufacturer. The are still producing motorcycles, cars, trucks, large-bore diesel engines, turbochargers, turbo machinery, compressors and chemical reactors. They are however most famous for their cars and here are the Volkswagen brands. The next time you go for a spinn with your Ducati remember it is a Volkswagen you are sitting on and never forget that the many will always beat the few in the end... one way or the other. 

Active: World wide with sales in 153 countries. 

P/E: -40.7 (P/E5: 5.7)


Here you can find the previous analysis of Volkswagen (VW) 2015

contrarian values of P/E, P/B, ROE as well as dividend for VW

The P/E for VW is horrible due to losses with -40.7 (but the P/E5 is still good) and the P/B is excellent with 0.7. Either way we get a very clear no go from Graham. Earnings to sales as well as ROE also makes no sense due to the losses.The book to debt ratio is however 0.3 which I find to be low.
In the last five years they have had a great yearly revenue growth rate of 6% which then gives us a motivated P/E of 16 to 20 which means that... compared to P/E5 VW is today undervalued by the market.
They pay a meaningless dividend in the size of 0.1% which of course will add to their loss.

Conclusion: Graham says no to VW and I say that pretty soon it will be of interest. Sure the P/E, ROE etc are looking bad but once the dust have settled there will be some value left and people tend to forget quicker than what they should. I will remain as a shareholder.

If this analysis is outdated then you can request a new one.

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