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As Nissan makes headlines, is Renault now a buy? (RNSDF, CARZ, NSANY)

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Nissan Motors ( NSANY , quote ) is increasing production of the Leaf to meet greater demand for the electric vehicle, which is good news for Renault SA ( RNSDF , quote ), the French auto maker partnered with the Japanese giant.

As detailed on www.emergingmoney.com in a previous article, " Buy Renault SA to profit from Nissan Motors the Warren Buffett. "

As that piece pointed out, Bruce Greenwald, a noted value investor, advocated buying Renault due to that company's ownership of shares of Nissan Motor Co, Ltd. From a recent Forbes article, Renault "isn't tearing up the track, but happens to own a valuable asset, its Nissan shares."

By itself, Renault SA has compelling financials. The price-to-earnings ratio is under 2. Sales growth is almost 16%. Income growth is over 200%.

Now trading around $33, RNSDF is much below its high for the year of about $67 due to the euro zone crisis.

Since that article in Forbes , Nissan Motors has posted increased sales in North America. As a result of this, according to an article in the Financial Times, the company is increasing production of the Leaf.

The future is looking so strong for NSANY that the board implemented a share buyback program. When growth returns to Europe, so will higher RNSDF prices.

It has been a difficult year for the automobile industry, with the exchange-traded fund for the sector, First Trust Global Auto Index Fund ( CARZ , quote ), trading around $22.50, down from the year high of about $32 a share.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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