"Patience is a Super Power" - "The Money is in the waiting"
Showing posts with label robots. Show all posts
Showing posts with label robots. Show all posts

Tuesday, July 1, 2025

We bought Hyundai Motors today (HYMTF) and here's why we like it!

 


Hyundai Motor Company (KRX:005380 / OTC: HYMTF) is increasingly attractive as an investment, especially if you're seeking exposure to the convergence of robotics, electric vehicles (EVs), and autonomous driving. Here's a breakdown of why Hyundai may be a solid investment right now, based on current dynamics:


Bull Case for Hyundai – July 2025

1. Boston Dynamics Integration = Unique Robotics Edge

  • Hyundai is one of the only global automakers with full control over a top-tier robotics firm.


  • Use of Spot, Stretch, and soon Atlas robots in factories, logistics, and inspection gives Hyundai a first-mover advantage in smart manufacturing.


  • This enhances productivity, reduces downtime, and may accelerate AV system testing (e.g. physical AI, real-time perception).

“Tens of thousands” of robots will be deployed across Hyundai and Kia plants — that's not R&D; that’s operational transformation.


2. Strong EV Momentum

  • Hyundai’s Ioniq lineup is highly rated (Ioniq 5 and 6), competing well with Tesla on quality, design, and price.


  • Major EV production plants in Georgia (U.S.) are ramping up, giving Hyundai a serious foothold in North America.

  • Hyundai’s battery partnerships (SK On, LG Energy) strengthen its supply chain.


3. AV Partnerships & Strategy

  • Motional (joint venture with Aptiv) is testing Level 4 robotaxis in the U.S. using Hyundai EV platforms.

  • Integration of sensor fusion, real-time mapping, and AI navigation systems is being tested now — a strong sign of future readiness in the AV space.


4. Undervalued Compared to U.S. Peers

  • Hyundai trades at much lower valuation multiples than Tesla, GM, or even Ford:

    • P/E ratio often under 8–9x

    • Price-to-book well under 1.0

  • Despite growing global EV sales, its valuation doesn’t yet reflect the robotics + AI upside that Tesla is often credited with.

  • June total sales of hybrid vehicles jumped 3%, resulting in the best June ever for hybrid and total electrified vehicle sales.

    Q2 and First Half Highlights

    Hyundai sold 235,726 units in Q2, for a total sales increase of 10% compared with Q2 2024. Hyundai set total and retail sales records in Q2 for Elantra N, Santa Fe HEV, Tucson PHEV, Tucson HEV and Palisade. Hybrid vehicle sales for the quarter rose 16%.

    Hyundai sold 439,280 total units in the first half of 2025, a 10% increase compared to the first half of 2024 and the best ever first half sales results. First half retail sales rose 5%. Total electrified vehicle sales saw an increase of 20% year-over-year.


5. Dividends & Global Growth

  • Hyundai pays a solid dividend (~2.5%–3% yield, depending on share class and FX).

  • It's expanding aggressively in India, Southeast Asia, and North America, growing both ICE and EV market share.


❌ Risks to Consider

RiskDetails
Geopolitical exposureKorea-based; vulnerable to tensions with North Korea, China, U.S. tariffs
Competitive landscapeFaces Tesla, BYD, VW, and new AV entrants like Apple or Xiaomi
AV timeline uncertaintyNo firm timeline for fully commercial AV products
BD not yet monetizedBoston Dynamics is still a cost center, not a profit engine—yet

๐Ÿ“ˆ Investment Summary

FactorGrade
Robotics edge via BD★★★★☆
AV development (Motional)★★★★☆
EV lineup & sales★★★★☆
Valuation★★★★★
Market momentum★★★☆☆

๐Ÿงญ My Take:

Hyundai is underappreciated by Western investors despite being:

  • A global top 5 EV manufacturer,

  • An early adopter of humanoid and autonomous robotics, and

  • Positioned for long-term gains in AV, factory automation, and battery EV sectors.

If you're building a robotics + EV portfolio, Hyundai is a compelling stock to pair with ETFs like BOTZ, ARKQ, and DRIV.

Full disclosure:

We bought Hyundai today and own BOTZ

ARKQ and DRIV are on our watch list!

Friday, June 20, 2025

Robots, Robotics and Automation - Investing in the "picks and shovels"!

 


If I had to pick only one "pick and shovel" stock to invest in for the robotics (especially humanoid/industrial robot) boom—including plays like Tesla's Optimus—my choice is:


๐Ÿ† Rockwell Automation (NYSE: ROK)

๐Ÿ”ง Why Rockwell?

1. Pure-play industrial automation leader

  • Rockwell is deeply embedded in manufacturing, robotics integration, motion control, industrial sensors, and factory digitization.

  • Its FactoryTalk, ControlLogix, and Allen-Bradley product lines are widely used in industrial robotics—from automotive to food production.

2. Strategic partnerships with AI & cloud giants

  • Rockwell has deep integrations with Microsoft Azure, NVIDIA Omniverse, and PTC (IoT CAD software)—vital for robotic design, simulation, and operation.

3. Robotics-native clients

  • Customers include Tesla, Boeing, Procter & Gamble, and automation integrators. Optimus-style humanoid robots will require factory retooling—which Rockwell enables.

4. Strong financials

  • High margins (~25% EBITDA), consistent free cash flow, and a track record of innovation make it a rare combo of growth, quality, and income (1.6% dividend yield).

  • Rockwell is profitable, with global exposure and minimal debt pressure.

5. Long-term megatrends tailwind

  • Growth in "lights-out factories", robotic arms, machine vision, and motion automation all converge at Rockwell.

  • As companies transition from legacy automation to AI-enhanced robotic systems, Rockwell provides the tools, software, and integration layers.


✳️ Quick Stats (as of June 2025)

MetricValue
Market Cap~$32B
Dividend Yield~1.6%
P/E Ratio~28x
YoY Revenue Growth~6%
Robotics/Automation %>75% of revenue

๐Ÿ†š Why Not Others?

  • Ametek (AME) and RBC Bearings (RBC) are great precision motion plays—but more passive in robotic development.

  • NVIDIA is critical—but not a pure "pick and shovel" for robotics. It's broader AI and data center focused.

  • ABB, Keyence, and Siemens are also excellent—but either not U.S.-based or less pure-play.

  • Ouster (LiDAR) and Regal Rexnord (motors) are too narrow.


✅ Final Word

If you're investing in the tools behind the robotics revolution, especially as it scales into humanoids like Tesla's Optimus, Rockwell Automation stands out as the most strategic, financially sound, and robotics-focused pick-and-shovel stock available today.

Rockwell Automation Inc (ROK)
$321.80
+$107.21(+49.96%)Past 5 years

Here’s a detailed breakdown of Rockwell Automation (ROK), covering earnings projections and technical valuation insights:


๐Ÿ“ˆ 5-Year Earnings & Growth Forecast

PeriodProjected EPS Growth
Next 1 yr (to 2026)From ~$7.97 today to ~$9.73 → ~22% increase
2026 Estimate~$11.31 EPS
2027 Estimate~$13.17 EPS
CAGR (2025–2028)EPS +14.2% / revenue +6.2% annually
Long-term (to 2029)Analysts forecast ~$14.11 EPS by FY 2029 
Analyst Consensus: About 6‑11 analysts expect EPS between $9–10 for FY 2025 and rising steadily through 2027 .

๐Ÿ“Š Technical Analysis Snapshot

  • Moving Averages:

    • On the daily scale, price is above 200‑day MA (~$277), 50‑day (~$283), and 20‑day (~$317), indicating a bullish trend 

    • Short‑term MAs also bullish in most models .

  • Trend & Patterns:
    ChartMill gives a technical rating of 9/10, with both short- and long-term trends positive.
    A bull-flag pattern suggests a potential buy-on-breakout opportunity, with support around $318 and resistance near $325 

  • Indicators:

    • RSI is neutral-to-strong — around mid‑range.

    • MACD recent crossover turns positive, supporting bullish momentum in daily models .

    • Investor’s Business Daily (IBD) upgraded RS rating to 83 (top quintile) but noted a slight pullback from a failed base entry near $308, implying a new base formation may be prudent 


๐Ÿ” Long-Term Outlook & Valuation

  • Earnings Growth Driver: Rockwell provides industrial automation solutions, benefiting from onshoring and the broader digitization of manufacturing. Barron’s highlights projected ~17% annual EPS growth through 2027 

  • Tariff Tailwinds: Rockwell is cited as a key beneficiary of increased onshoring due to higher tariffs, making it a go-to industrial play in that trend .

  • Valuation Summary:

    • Trading near $322, with a one-year average price target of $326 (range $290–371) by Wall Street 

    • Reasonable P/E based on ~$9–10 EPS, giving ~30×–35× forward P/E—typical for a high-quality industrial automation company.


๐Ÿงญ Bottom Line

  • Earnings Trajectory: Robust growth expected — ~14–22% EPS CAGR over next 2–5 years.

  • Technical Setup: Bullish trend with backup from multiple indicators and chart patterns, though a careful entry after base confirmation may yield better risk/reward.

  • Macro-Catalysts: Onshoring, increased automation, and high-margin solutions support earnings and valuation.


Your Next Moves

  • For long-term exposure: Buying on dips above $318–$320 with a multi-year view of automation trends—and holding for EPS growth and rising automation adoption.

  • For tactical entries: Monitor a breakout above $325 on expanding volume—this would confirm bullish momentum and enable tighter, disciplined entries.

Here’s a refined model for a 12-month target price on Rockwell Automation (ROK):


๐Ÿ“Š 1. Base Scenario: Conservative PE

  • EPS Estimate for FY2026: ~$11.49 

  • Modest Forward P/E: 26× (near its historical fair ratio of ~29×)

  • Target Price: 11.49 × 26 ≈ $299

This projection is slightly below current levels, suggesting limited upside if the market is cautious.


๐Ÿ”ผ 2. Growth Scenario: Elevated PE

  • Same EPS: $11.49

  • Premium P/E: 30× (reflecting continued automation enthusiasm)

  • Target Price: 11.49 × 30 ≈ $345

This targets the upper range of analyst forecasts and assumes multiple expansion 


๐Ÿ›  3. Bull Case: Full Growth Re-Rating

  • EPS for FY2027: ~$13.19 

  • High-End P/E: 28× (middle ground between growth and valuation)

  • Target Price: 13.19 × 28 ≈ $370

This aligns with the top analyst estimate ($371) .


๐Ÿ“Œ Summary Table

ScenarioAssumed EPSP/E MultipleTarget Price
Base$11.4926×$299
Growth$11.4930×$345
Bull (2027)$13.1928×$370

๐Ÿ” Interpretation

Thursday, May 15, 2025

Magna International demonstrates robust fundamentals, a diversified global presence, and strategic investments in future mobility technologies



Magna International is a leading Canadian mobility technology company and one of the world's largest automotive suppliers. Headquartered in Aurora, Ontario, Magna operates 342 manufacturing facilities and 103 product development, engineering, and sales centers across 28 countries, employing approximately 167,000 people. Magna+9dakkota.com+9MarketScreener+9Magna+5Wikipedia+5Magna+5


๐Ÿ“ˆ Stock Performance


๐Ÿ’ฐ Financial Highlights


๐ŸŒ Global Operations

Magna's extensive global footprint includes operations in North America, Europe, Asia, South America, and Africa. The company supports every major automaker worldwide, with a significant presence in emerging markets such as China, South America, Eastern Europe, and India. Magna+3Magna+3Magna+3


๐Ÿค Partnerships & Clients

  • Key Clients: General Motors, Ford, Stellantis, BMW, Mercedes-Benz, Volkswagen, Toyota, Tesla, Tata Motors, Bombardier, Harley-Davidson, John Deere, and others.

  • Recent Partnerships:

    • Mercedes-Benz: Expanded collaboration on powertrain systems, ADAS technologies, and electrification.

    • NVIDIA: Joint development of AI-powered solutions for next-generation vehicle intelligence and autonomy.

    • Waymo: Partnership to build over 2,000 fully autonomous Jaguar I-PACE vehicles and integrate Waymo's technology into new vehicle platforms.

    • Sanctuary AI: Strategic partnership for the development of general-purpose AI robots for manufacturing operations. Wikipedia+1Magna+1MagnaMagnaReutersCoast Reporter


๐Ÿ“Š Major Shareholders


๐Ÿš€ Growth Potential

Magna is strategically positioned to capitalize on key automotive industry trends:

  • Electrification: Development of next-generation eDrive systems and battery enclosures.                                                                             Magna Steyr


  • Magna Steyr Austria EV plant 

  • Autonomous Driving: Collaborations with NVIDIA and Waymo to advance vehicle autonomy. 

  • Magna/Waymo AV Michigan plant
  • Connectivity: Integration of 5G technology to enhance vehicle connectivity and ADAS capabilities. Magna+21Magna+21GlobeNewswire+21ReutersMagna

Analysts anticipate a 95% increase in earnings over the next few years, reflecting a highly optimistic outlook. Simply Wall St


⚠️ Tariff Impact

The imposition of U.S. tariffs has significantly impacted Magna's operations:Magna+5Reuters+5Magna+5

  • Estimated Annual Hit: $250 million from import duties.

  • CEO's Statement: Swamy Kotagiri likened the tariff impact to facing multiple crises simultaneously, including COVID-19, chip shortages, and the Great Recession.

  • Mitigation Strategies: Implementation of cost-saving measures, operational improvements, restructuring, and cuts to capital and engineering expenses. MarketScreener+1MarketScreener+1Wikipedia+3partstrader.com+3Reuters+3Reuters


๐Ÿง  Innovation & Technology

Magna continues to invest in cutting-edge technologies:

  • AI & Robotics: Partnership with Sanctuary AI for developing human-like robots for manufacturing. 

  • Software Platforms: Collaboration with GM and Wipro to create SDVerse, a B2B marketplace for automotive software.

  • Sustainability: Initiatives to develop sustainable solutions using recycled materials and reduce environmental impact. Coast ReporterInvestopediaMagna


๐Ÿงพ Conclusion

Magna International demonstrates robust fundamentals, a diversified global presence, and strategic investments in future mobility technologies. While facing challenges from tariffs and market fluctuations, the company's proactive measures and strong partnerships position it well for long-term growth. Investors may find Magna's current valuation attractive, considering its commitment to innovation, sustainability, and shareholder returns.

Ed Note:  We are long MG stock!