The Globe and Mail reports in its Tuesday, Jan. 19, edition that Magna International ($48.48) stands a good chance of benefiting from the rise of robotic automobiles. The Globe's Chris Umiastowski writes that Apple is working on
its own electric-car design. Apple
outsources practically all of its
manufacturing operations. If Apple enters the car
business, Mr. Umiastowski expects it to outsource as
much manufacturing as possible.
Mr. Umiastowski doubts Apple will start by using
Chinese manufacturing partners
as it does with consumer electronics.
Google, too, has been testing
self-driving cars for several years,
and there is no reason to think
it will want to get into manufacturing
when other world-class
manufacturers already exist.
There is no bigger independent
automotive manufacturing company
than Canada's Magna.
Over the past five years,
Magna has driven strong financial
performance and the stock trades
at a price-to-earnings ratio below eight using
this year's consensus earnings-per-share estimate. If Silicon Valley
makes a heavy push into the
car business, Mr. Umiastowski believes Magna will
be a winner. The Globe's Ian Tam said buy Magna on Jan. 14. It was then worth $51.69.
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