Denso Corp (ADR) (NASDAQOTH:DNZOY)

devoish (98.76) Submitted: 1/13/2010 5:49:09 PM : Start Price: $131.00 DNZOY Score: +3.28

This is a great company with excellent quality parts. It's largest customer is Toyota and Denso parts are a big part of T's reputation for quality. In 2007 denso had per share earnings of 250. 250 yen. That converts to $2.50 in US dollars in one of their best years ever. In the six months ended Sept 2008 they recovered from losses to achieve earnings of 6.27 yen for the first six months of 2009. That is earnings of $.07. If they double that for the year they have a P/E of 915.
To justify this share price assuming a P/E of 20 they would have to achieve sales of 583 yen. That is twice as many cars sold as in 2007. Unfortunately only half as many cars are being sold. This price is to high for this company, even though it is an excellent company.