Toyota’s quality made us break our rule

Article Excerpt

As a rule, we feel North America’s stock markets provide all the diversification that most investors need. However, a handful of foreign investments are attractive enough to be worthwhile buys, especially when they trade on New York as American Depository Receipts or ADRs. TOYOTA MOTOR CORP. ADRs $116 (New York symbol TM; WSSF Rating: Above average) is Japan’s largest automobile maker, and the world’s second-largest after General Motors. Sales outside of Japan account for 60% of the total. Toyota also makes industrial equipment such as forklifts, and pre-fabricated housing. Like most automakers, it offers vehicle loans through its financing division. Each Toyota ADR represents two of Toyota’s common shares. Japan imposes a 15% withholding tax on dividends paid to U.S. stockholders. Toyota’s sales grew from $106.4 billion in 2001 (fiscal years end March 31) to $172.7 billion in 2005. Profits slipped from $2.92 per ADR (total $5.4 billion) in 2001 to $2.28 per ADR ($4.2 billion) in 2002, but jumped to $6.66 per…

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