| Snowflake Score | |
|---|---|
| Valuation | 4/6 |
| Future Growth | 1/6 |
| Past Performance | 4/6 |
| Financial Health | 4/6 |
| Dividends | 4/6 |
HMC Stock Overview
Honda Motor Co., Ltd. develops, manufactures, and distributes motorcycles, automobiles, power products, and other products in Japan, North America, Europe, Asia, and internationally.
Honda Motor Competitors
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | JP¥29.78 |
| 52 Week High | JP¥33.42 |
| 52 Week Low | JP¥26.33 |
| Beta | 1.01 |
| 1 Month Change | 8.85% |
| 3 Month Change | -0.47% |
| 1 Year Change | 6.55% |
| 3 Year Change | 1.64% |
| 5 Year Change | -3.28% |
| Change since IPO | 376.48% |
Recent News & Updates
Honda - Driving Nowhere Slowly
A reader contacted me after my article/s on German automotives and asked me to review Honda. I don't often review or read on Japanese companies - but Honda's market position in the USA is strong, and the company is potentially interesting. Read my stance on Honda, and why I am not impressed with the company, or the valuation.
Honda Motor Co.: Going Nowhere Without A Change
The automobile industry has been seeing some positive catalysts as they navigate electrification and automation of their motors and technologies. With hype seeming to play a critical role in the success, or lack thereof, of companies' sales growth, Honda is trailing behind and is projected to report slower annual growth. As a result, I believe they currently constitute a poor long-term investment.
Trade Plan: Honda Motor
Auto manufacturer beats sales and earnings estimates in Q1. Momentum is certainly on its side. As an alternative to buying shares, we look at a trade setup which controls risk but also gives strong upside potential.
Shareholder Returns
| HMC | US Auto | US Market | |
|---|---|---|---|
| 7D | -2.8% | -10.1% | -4.6% |
| 1Y | 6.5% | 11.2% | 7.7% |
Return vs Industry: HMC underperformed the US Auto industry which returned 16.1% over the past year.
Return vs Market: HMC underperformed the US Market which returned 10.2% over the past year.
Price Volatility
| HMC volatility | |
|---|---|
| HMC Average Weekly Movement | 3.1% |
| Auto Industry Average Movement | 9.9% |
| Market Average Movement | 6.6% |
| 10% most volatile stocks in US Market | 15.7% |
| 10% least volatile stocks in US Market | 2.4% |
Stable Share Price: HMC is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.
Volatility Over Time: HMC's weekly volatility (3%) has been stable over the past year.
About the Company
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 1946 | 211,374 | Toshihiro Mibe | https://www.honda.co.jp |
Honda Motor Co., Ltd. develops, manufactures, and distributes motorcycles, automobiles, power products, and other products in Japan, North America, Europe, Asia, and internationally. It operates through four segments: Motorcycle Business, Automobile Business, Financial Services Business, and Life creation and Other Businesses. The Motorcycle Business segment produces motorcycles, including sports, business, and commuter models; and various off-road vehicles, such as all-terrain vehicles and side-by-sides.
Honda Motor Fundamentals Summary
| HMC fundamental statistics | |
|---|---|
| Market Cap | JP¥5.85t |
| Earnings (TTM) | JP¥886.58b |
| Revenue (TTM) | JP¥14.38t |
6.6x
P/E Ratio0.4x
P/S RatioIs HMC overvalued?
See Fair Value and valuation analysisEarnings & Revenue
| HMC income statement (TTM) | |
|---|---|
| Revenue | JP¥14.38t |
| Cost of Revenue | JP¥11.35t |
| Gross Profit | JP¥3.04t |
| Expenses | JP¥2.15t |
| Earnings | JP¥886.58b |
Last Reported Earnings
Sep 30, 2021
Next Earnings Date
n/a
| Earnings per share (EPS) | 518.84 |
| Gross Margin | 21.11% |
| Net Profit Margin | 6.16% |
| Debt/Equity Ratio | 79.3% |
How did HMC perform over the long term?
See historical performance and comparisonDividends
3.2%
Current Dividend Yield16%
Payout RatioValuation
Is Honda Motor undervalued compared to its fair value and its price relative to the market?
6.6x
Price to Earnings (PE) ratio
Share Price vs. Fair Value
Below Fair Value: HMC ($29.78) is trading above our estimate of fair value ($12.84)
Significantly Below Fair Value: HMC is trading above our estimate of fair value.
Price To Earnings Ratio
PE vs Industry: HMC is good value based on its PE Ratio (6.6x) compared to the US Auto industry average (16.2x).
PE vs Market: HMC is good value based on its PE Ratio (6.6x) compared to the US market (17x).
Price to Earnings Growth Ratio
PEG Ratio: HMC is good value based on its PEG Ratio (1x)
Price to Book Ratio
PB vs Industry: HMC is good value based on its PB Ratio (0.6x) compared to the US Auto industry average (3.5x).
Future Growth
How is Honda Motor forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?
6.8%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: HMC's forecast earnings growth (6.8% per year) is above the savings rate (2%).
Earnings vs Market: HMC's earnings (6.8% per year) are forecast to grow slower than the US market (13% per year).
High Growth Earnings: HMC's earnings are forecast to grow, but not significantly.
Revenue vs Market: HMC's revenue (5% per year) is forecast to grow slower than the US market (9.2% per year).
High Growth Revenue: HMC's revenue (5% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: HMC's Return on Equity is forecast to be low in 3 years time (7.8%).
Past Performance
How has Honda Motor performed over the past 5 years?
-3.8%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: HMC has high quality earnings.
Growing Profit Margin: HMC's current net profit margins (6.2%) are higher than last year (1.9%).
Past Earnings Growth Analysis
Earnings Trend: HMC's earnings have declined by 3.8% per year over the past 5 years.
Accelerating Growth: HMC's earnings growth over the past year (259%) exceeds its 5-year average (-3.8% per year).
Earnings vs Industry: HMC earnings growth over the past year (259%) exceeded the Auto industry 210.7%.
Return on Equity
High ROE: HMC's Return on Equity (9.6%) is considered low.
Financial Health
How is Honda Motor's financial position?
Financial Position Analysis
Short Term Liabilities: HMC's short term assets (¥7,158.0B) exceed its short term liabilities (¥5,288.2B).
Long Term Liabilities: HMC's short term assets (¥7,158.0B) exceed its long term liabilities (¥6,864.1B).
Debt to Equity History and Analysis
Debt Level: HMC's net debt to equity ratio (50.5%) is considered high.
Reducing Debt: HMC's debt to equity ratio has reduced from 89.2% to 79.3% over the past 5 years.
Debt Coverage: HMC's debt is not well covered by operating cash flow (11.2%).
Interest Coverage: HMC earns more interest than it pays, so coverage of interest payments is not a concern.
Balance Sheet
Dividend
What is Honda Motor current dividend yield, its reliability and sustainability?
3.21%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: HMC's dividend (3.21%) is higher than the bottom 25% of dividend payers in the US market (1.35%).
High Dividend: HMC's dividend (3.21%) is low compared to the top 25% of dividend payers in the US market (3.48%).
Stability and Growth of Payments
Stable Dividend: HMC's dividends per share have been stable in the past 10 years.
Growing Dividend: HMC's dividend payments have increased over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its low payout ratio (15.6%), HMC's dividend payments are well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
5.3yrs
Average management tenure
CEO
Toshihiro Mibe (60 yo)
0.75
Tenure
Mr. Toshihiro Mibe serves as Director at Honda Motor Co., Ltd. since June 2020 and serves as its President since April 1, 2021 and has been its Chief Executive Officer since June 23, 2021 and served as Sen...
Leadership Team
Experienced Management: HMC's management team is seasoned and experienced (5.3 years average tenure).
Board Members
Experienced Board: HMC's board of directors are not considered experienced ( 2.1 years average tenure), which suggests a new board.
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
Honda Motor Co., Ltd.'s employee growth, exchange listings and data sources
Key Information
- Name: Honda Motor Co., Ltd.
- Ticker: HMC
- Exchange: NYSE
- Founded: 1946
- Industry: Automobile Manufacturers
- Sector: Automobiles
- Implied Market Cap: JP¥5.851t
- Listing Market Cap: JP¥51.213b
- Shares outstanding: 1.71b
- Website: https://www.honda.co.jp
Number of Employees
Location
- Honda Motor Co., Ltd.
- 2-1-1, Minami-Aoyama
- Minato-ku
- Tokyo
- 107-8556
- Japan
Listings
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2022/01/19 23:33 |
| End of Day Share Price | 2022/01/19 00:00 |
| Earnings | 2021/09/30 |
| Annual Earnings | 2021/03/31 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.