Filed under: Competitive strategy, Best Buy (BBY), Circuit City Stores (CC)

Best Buy, Inc. (NYSE: BBY) was downgraded by Cowen & Co. Tuesday from Outperform to Neutral even as the largest consumer electronics chain in the U.S. continues to beam proudly with all the success it’s been achieving recently. Best Buy CEO Brad Anderson even said, “We have never had to pull anything back in a significant way and don’t see that on the horizon. Right now we see indicators that it’s a tougher climate, but we don’t see indicators to say that its likely to be a really difficult one. So, what is all the hubbub about?”

Cowen & Co. indicated that product cycles in the electronics sector may be slowing, which could crimp sales for the consumer electronics retailer. Cowen cited “strong products to drive sales” in the note sent to clients, specifically noting the larger product cycles of TVs and computers are starting to wane as consumers rapidly replace older televisions with newer flat-panel units and PC sales see double-digit growth outside the U.S. (and decent growth inside). Best Buy is also aggressively entering the Chinese and Indian markets. Let’s pause while collective head-scratching commences.

A glance at Best Buy’s main rival Circuit City Stores, Inc. (NYSE: CC), which had a disastrous 2007 (and was rumored to be considering throwing CEO Phil Schoonover to the curb), and it’s hard to see Best Buy doing anything but good in 2008. If product cycles are indeed slowing for larger-margin products, Cowen did say a lack of “compelling” products may hurt it. I’ll cede that — but it’s the only thing standing in Best Buy’s way this year.

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Filed under: Competitive strategy, Best Buy (BBY), Circuit City Stores (CC)

Best Buy, Inc. (NYSE: BBY) was downgraded by Cowen & Co. Tuesday from Outperform to Neutral even as the largest consumer electronics chain in the U.S. continues to beam proudly with all the success it’s been achieving recently. Best Buy CEO Brad Anderson even said, “We have never had to pull anything back in a significant way and don’t see that on the horizon. Right now we see indicators that it’s a tougher climate, but we don’t see indicators to say that its likely to be a really difficult one. So, what is all the hubbub about?”

Cowen & Co. indicated that product cycles in the electronics sector may be slowing, which could crimp sales for the consumer electronics retailer. Cowen cited “strong products to drive sales” in the note sent to clients, specifically noting the larger product cycles of TVs and computers are starting to wane as consumers rapidly replace older televisions with newer flat-panel units and PC sales see double-digit growth outside the U.S. (and decent growth inside). Best Buy is also aggressively entering the Chinese and Indian markets. Let’s pause while collective head-scratching commences.

A glance at Best Buy’s main rival Circuit City Stores, Inc. (NYSE: CC), which had a disastrous 2007 (and was rumored to be considering throwing CEO Phil Schoonover to the curb), and it’s hard to see Best Buy doing anything but good in 2008. If product cycles are indeed slowing for larger-margin products, Cowen did say a lack of “compelling” products may hurt it. I’ll cede that — but it’s the only thing standing in Best Buy’s way this year.

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Filed under: International markets, Forecasts, Competitive strategy, General Motors (GM), Marketing and advertising, Toyota Motor Corp. (TM)

This morning, Toyota Motor Corp. (NYSE: TM) posted a rise of 6% for its global group sales to a total of 9.37 million vehicles last year. The company’s results put increased pressure on General Motors Corp. (NYSE: GM) for the title of the world’s largest automaker.

General Motor hasn’t announced yet its annual sales results, but analysts expect the company show 2007 sales of 9.3 million vehicles. As we can see, the sales numbers suggest a tight race in the company’s fight for the biggest automaker in global sales.

The recent surge in oil prices helped Toyota to increase sales of its more fuel efficient cars, such as the Camry sedan and the Prius gas-electric hybrid models. General Motors has been able to keep the top industry spot for the past 76 years.

According to a statement from the Japanese automaker, Toyota’s group companies posted a growth of 10% for vehicles sold overseas during the last year, rising up to 7.1 million. The results offset a 4% drop in sales in Japan to 2.26 million vehicles. The sales numbers show that Toyota beat GM in profitability. Let’s remember that over the recent years, General Motors had to face a difficult period when it had to close plants, reduce plans for truck production and cut jobs.

Some of Toyota’s executives admit they are nervous about becoming the world’s biggest automaker as they are afraid to invoke a U.S. backlash similar to the “Japan-bashing” in the 1980s and 90s. Nonetheless, Toyota announced last month it plans to hit a target of 9.85 million vehicles sales worldwide this year, up 5% from last year.

The auto industry competition becomes even stronger as new rivals appear in China, Russia, South America and other regions. Analysts had also predicted weaker car sales for Toyota as U.S. growth slows and a growing gap in Japan’s socioeconomic classes.

Looking ahead, Toyota plans to gain ground in new markets by setting up new overseas plants. The automaker aims to increase its production by 5% next year to 9.95 million vehicles. Despite strong competition, the company’s projects seem encouraging for many analysts who believe it’s just a matter of time before Toyota beats GM to become the biggest automaker in global sales.

In other automotive news, be sure to read up on the world’s cheapest car, the Nano, which Tata Motors (NYSE: TTM) has just unveiled for under $2,500.

Eliza Popescu is a financial writer for the online investment advisory service Investor’s Observer.

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Filed under: International markets, Forecasts, Competitive strategy, General Motors (GM), Marketing and advertising, Toyota Motor Corp. (TM)

This morning, Toyota Motor Corp. (NYSE: TM) posted a rise of 6% for its global group sales to a total of 9.37 million vehicles last year. The company’s results put increased pressure on General Motors Corp. (NYSE: GM) for the title of the world’s largest automaker.

General Motor hasn’t announced yet its annual sales results, but analysts expect the company show 2007 sales of 9.3 million vehicles. As we can see, the sales numbers suggest a tight race in the company’s fight for the biggest automaker in global sales.

The recent surge in oil prices helped Toyota to increase sales of its more fuel efficient cars, such as the Camry sedan and the Prius gas-electric hybrid models. General Motors has been able to keep the top industry spot for the past 76 years.

According to a statement from the Japanese automaker, Toyota’s group companies posted a growth of 10% for vehicles sold overseas during the last year, rising up to 7.1 million. The results offset a 4% drop in sales in Japan to 2.26 million vehicles. The sales numbers show that Toyota beat GM in profitability. Let’s remember that over the recent years, General Motors had to face a difficult period when it had to close plants, reduce plans for truck production and cut jobs.

Some of Toyota’s executives admit they are nervous about becoming the world’s biggest automaker as they are afraid to invoke a U.S. backlash similar to the “Japan-bashing” in the 1980s and 90s. Nonetheless, Toyota announced last month it plans to hit a target of 9.85 million vehicles sales worldwide this year, up 5% from last year.

The auto industry competition becomes even stronger as new rivals appear in China, Russia, South America and other regions. Analysts had also predicted weaker car sales for Toyota as U.S. growth slows and a growing gap in Japan’s socioeconomic classes.

Looking ahead, Toyota plans to gain ground in new markets by setting up new overseas plants. The automaker aims to increase its production by 5% next year to 9.95 million vehicles. Despite strong competition, the company’s projects seem encouraging for many analysts who believe it’s just a matter of time before Toyota beats GM to become the biggest automaker in global sales.

In other automotive news, be sure to read up on the world’s cheapest car, the Nano, which Tata Motors (NYSE: TTM) has just unveiled for under $2,500.

Eliza Popescu is a financial writer for the online investment advisory service Investor’s Observer.

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Filed under: Products and services, Competitive strategy, Ford Motor (F), General Motors (GM), India, Tata Mtrs Ltd (TTM)

As if Detroit didn’t have enough to worry about, Tata Motors (NYSE: TTM) has unveiled its long-awaited super-cheap car at the Auto Expo in New Delhi. Called the Nano, it’s tiny and kind of cute, in a smooshed jelly bean kind of way. Its most attractive feature, though, is its price. For a mere 100,000 rupees, the equivalent of roughly $2,500, you can drive home in the world’s least expensive car (assuming you live in India, of course).

According to AutoBlog, here’s what you get for your 100,000 rupees: a two cylinder gasoline engine producing a whopping 30 horsepower, a four-speed manual transmission, room for five (very small) people, brakes of some kind, and, best of all, 54 miles per gallon of gas. You don’t get a radio or power steering or a second windshield wiper, but did you really expect to? Even so, the car is reasonably safe and efficient by Indian standards, and Tata claims that it meets all environmental and safety regulations in India.

It’s hard not to be impressed by the Nano, and by the potential of Tata Motors. Tata is already the largest auto manufacturer in India. Millions of Tata vehicles are already on the roads, and with the Nano, we can expect to see millions more. Tata also sells cars and trucks all over Asia and has a growing presence in the Middle East and Latin America. If you want to place a bet on the future of the global auto industry, you could do worse than buying some Tata stock. Just as General Motors (NYSE: GM) and Ford (NYSE: F) provided basic transport in the world’s fastest growing economy early 20th century, Tata is poised to sell millions of basic cars in the fastest growing part of the world in the 21st century.

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Filed under: Products and services, Competitive strategy, Ford Motor (F), General Motors (GM), India, Tata Mtrs Ltd (TTM)

As if Detroit didn’t have enough to worry about, Tata Motors (NYSE: TTM) has unveiled its long-awaited super-cheap car at the Auto Expo in New Delhi. Called the Nano, it’s tiny and kind of cute, in a smooshed jelly bean kind of way. Its most attractive feature, though, is its price. For a mere 100,000 rupees, the equivalent of roughly $2,500, you can drive home in the world’s least expensive car (assuming you live in India, of course).

According to AutoBlog, here’s what you get for your 100,000 rupees: a two cylinder gasoline engine producing a whopping 30 horsepower, a four-speed manual transmission, room for five (very small) people, brakes of some kind, and, best of all, 54 miles per gallon of gas. You don’t get a radio or power steering or a second windshield wiper, but did you really expect to? Even so, the car is reasonably safe and efficient by Indian standards, and Tata claims that it meets all environmental and safety regulations in India.

It’s hard not to be impressed by the Nano, and by the potential of Tata Motors. Tata is already the largest auto manufacturer in India. Millions of Tata vehicles are already on the roads, and with the Nano, we can expect to see millions more. Tata also sells cars and trucks all over Asia and has a growing presence in the Middle East and Latin America. If you want to place a bet on the future of the global auto industry, you could do worse than buying some Tata stock. Just as General Motors (NYSE: GM) and Ford (NYSE: F) provided basic transport in the world’s fastest growing economy early 20th century, Tata is poised to sell millions of basic cars in the fastest growing part of the world in the 21st century.

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Filed under: Competitive strategy, Google (GOOG)

When Wikipedia was conceived, few would have thought it would end up in the regular top-10 of internet sites — but it has. The largest encyclopedia in the world has a viewership that any entity on the web would kill for. Its strength remains in the ability of anyone to create and edit encyclopedia entries, giving the power to the people (literally).

What was next, then, for Jimmy Wales, one of Wikipedia’s founders? Why, a search engine, of course. Although Google has a tight grip on that market already, the new Wikia.com believes it can contend for the internet search championship belt at some point in time. It’s off to a very rocky start (and sorely disappointing to many), but does Wikia.com have a chance to compete against Google where internet stalwarts Yahoo, Inc. (NASDAQ: YHOO) and Microsoft Corp. (NASDAQ: MSFT) have so far failed? if so, why?

According to Wales, Wikia.com will succeed because it will be more trustworthy than any other internet search provider. His reason is the same one that has made Wikipedia so popular: anyone will be able to control the results returned from a Wikia.com search. No automated Google algorithms or automated software bots that can be rigged to giving certain search results.

Is Wales correct? Will customers see the value in being able to vote down results that are fluff or not very relevant better than Google’s artificially intelligent software? If customers do see this value — and enough of them start using Wikia.com — Google could potentially see its largest threat yet in the internet search arena. But it will be years down the road from now before consumers flock to anything other than Google.

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Filed under: Competitive strategy, Google (GOOG)

When Wikipedia was conceived, few would have thought it would end up in the regular top-10 of internet sites — but it has. The largest encyclopedia in the world has a viewership that any entity on the web would kill for. Its strength remains in the ability of anyone to create and edit encyclopedia entries, giving the power to the people (literally).

What was next, then, for Jimmy Wales, one of Wikipedia’s founders? Why, a search engine, of course. Although Google has a tight grip on that market already, the new Wikia.com believes it can contend for the internet search championship belt at some point in time. It’s off to a very rocky start (and sorely disappointing to many), but does Wikia.com have a chance to compete against Google where internet stalwarts Yahoo, Inc. (NASDAQ: YHOO) and Microsoft Corp. (NASDAQ: MSFT) have so far failed? if so, why?

According to Wales, Wikia.com will succeed because it will be more trustworthy than any other internet search provider. His reason is the same one that has made Wikipedia so popular: anyone will be able to control the results returned from a Wikia.com search. No automated Google algorithms or automated software bots that can be rigged to giving certain search results.

Is Wales correct? Will customers see the value in being able to vote down results that are fluff or not very relevant better than Google’s artificially intelligent software? If customers do see this value — and enough of them start using Wikia.com — Google could potentially see its largest threat yet in the internet search arena. But it will be years down the road from now before consumers flock to anything other than Google.

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Filed under: Competitive strategy, Indices, Next big thing, Green Stocks

Green energy and eco-friendliness were some top themes on consumer and business minds in 2007, and this will most likely continue into 2008 and in the coming years as well. Given the huge increase in fuel prices in the last 36 months, it’s no wonder that investors have pushed up the shares of these companies.

Alternative and green energies will, in my opinion, be an investment area that should demand attention this year if you are ready to expose your portfolio to what is not a trend at all, but what is becoming the future. There’s a reason why General Motors Corp. (NYSE: GM) and Toyota Motor Co. (NYSE: TM), for example, continue making statements about vehicles that run on anything but gasoline.

Although 2007 saw great returns with renewable energy stocks, 2008 holds the same promise. Looking for areas in which to research and invest? Start by focusing in on companies within the WilderHill clean energy index (which contains 48 renewable energy stocks). The index was up 58% in 2007 after single-digit gains in 2005 and 2006. While solar power stocks already saw a huge increase in 2007 (some with 100% returns), that arena may take more careful scrutiny for 2008 if you’re looking for market-leading stock performance. At the same time, wind energy stocks are poised for larger returns in 2008 in the game to lead market returns for all renewable energy stock categories.

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Filed under: Competitive strategy, Indices, Next big thing, Green Stocks

Green energy and eco-friendliness were some top themes on consumer and business minds in 2007, and this will most likely continue into 2008 and in the coming years as well. Given the huge increase in fuel prices in the last 36 months, it’s no wonder that investors have pushed up the shares of these companies.

Alternative and green energies will, in my opinion, be an investment area that should demand attention this year if you are ready to expose your portfolio to what is not a trend at all, but what is becoming the future. There’s a reason why General Motors Corp. (NYSE: GM) and Toyota Motor Co. (NYSE: TM), for example, continue making statements about vehicles that run on anything but gasoline.

Although 2007 saw great returns with renewable energy stocks, 2008 holds the same promise. Looking for areas in which to research and invest? Start by focusing in on companies within the WilderHill clean energy index (which contains 48 renewable energy stocks). The index was up 58% in 2007 after single-digit gains in 2005 and 2006. While solar power stocks already saw a huge increase in 2007 (some with 100% returns), that arena may take more careful scrutiny for 2008 if you’re looking for market-leading stock performance. At the same time, wind energy stocks are poised for larger returns in 2008 in the game to lead market returns for all renewable energy stock categories.

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