HONDA MOTOR CO LTD-SPONS ADR (HMC)
US4381283088 - ADR
Overall HMC gets a fundamental rating of 5 out of 10. We evaluated HMC against 41 industry peers in the Automobiles industry. HMC has an excellent profitability rating, but there are concerns on its financial health. HMC may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
HMC had positive earnings in the past year.
In the past year HMC had a positive cash flow from operations.
HMC had positive earnings in each of the past 5 years.
Each year in the past 5 years HMC had a positive operating cash flow.
1.2 Ratios
The Return On Assets of HMC (3.64%) is better than 73.17% of its industry peers.
HMC's Return On Equity of 8.49% is fine compared to the rest of the industry. HMC outperforms 73.17% of its industry peers.
HMC's Return On Invested Capital of 5.06% is fine compared to the rest of the industry. HMC outperforms 73.17% of its industry peers.
The Average Return On Invested Capital over the past 3 years for HMC is significantly below the industry average of 10.90%.
The last Return On Invested Capital (5.06%) for HMC is above the 3 year average (3.75%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.64% | ||
| ROE | 8.49% | ||
| ROIC | 5.06% |
ROA(3y)3.1%
ROA(5y)2.91%
ROE(3y)7.1%
ROE(5y)6.84%
ROIC(3y)3.75%
ROIC(5y)3.43%
1.3 Margins
With a decent Profit Margin value of 5.37%, HMC is doing good in the industry, outperforming 75.61% of the companies in the same industry.
In the last couple of years the Profit Margin of HMC has grown nicely.
With an excellent Operating Margin value of 6.94%, HMC belongs to the best of the industry, outperforming 80.49% of the companies in the same industry.
In the last couple of years the Operating Margin of HMC has grown nicely.
HMC has a better Gross Margin (21.74%) than 82.93% of its industry peers.
HMC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.94% | ||
| PM (TTM) | 5.37% | ||
| GM | 21.74% |
OM growth 3Y10.51%
OM growth 5Y8.15%
PM growth 3Y2.78%
PM growth 5Y7.13%
GM growth 3Y1.37%
GM growth 5Y0.74%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), HMC is destroying value.
Compared to 1 year ago, HMC has less shares outstanding
The number of shares outstanding for HMC has been increased compared to 5 years ago.
The debt/assets ratio for HMC is higher compared to a year ago.
2.2 Solvency
HMC has an Altman-Z score of 1.69. This is a bad value and indicates that HMC is not financially healthy and even has some risk of bankruptcy.
HMC has a better Altman-Z score (1.69) than 70.73% of its industry peers.
HMC has a Debt/Equity ratio of 0.46. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of HMC (0.46) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.69 |
ROIC/WACC0.73
WACC6.9%
2.3 Liquidity
A Current Ratio of 1.37 indicates that HMC should not have too much problems paying its short term obligations.
HMC has a Current ratio of 1.37. This is comparable to the rest of the industry: HMC outperforms 46.34% of its industry peers.
HMC has a Quick Ratio of 1.07. This is a normal value and indicates that HMC is financially healthy and should not expect problems in meeting its short term obligations.
HMC has a Quick ratio (1.07) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.37 | ||
| Quick Ratio | 1.07 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 29.96% over the past year.
HMC shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -8.17% yearly.
HMC shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 19.80%.
Measured over the past years, HMC shows a small growth in Revenue. The Revenue has been growing by 5.16% on average per year.
EPS 1Y (TTM)29.96%
EPS 3Y-15.97%
EPS 5Y-8.17%
EPS Q2Q%12.04%
Revenue 1Y (TTM)19.8%
Revenue growth 3Y15.76%
Revenue growth 5Y5.16%
Sales Q2Q%16.86%
3.2 Future
The Earnings Per Share is expected to grow by 4.58% on average over the next years.
Based on estimates for the next years, HMC will show a small growth in Revenue. The Revenue will grow by 2.89% on average per year.
EPS Next Y4.45%
EPS Next 2Y4.5%
EPS Next 3Y4.58%
EPS Next 5YN/A
Revenue Next Year4.97%
Revenue Next 2Y3.06%
Revenue Next 3Y2.89%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
HMC is valuated cheaply with a Price/Earnings ratio of 6.31.
Based on the Price/Earnings ratio, HMC is valued cheaper than 95.12% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 31.71, HMC is valued rather cheaply.
HMC is valuated cheaply with a Price/Forward Earnings ratio of 6.01.
Based on the Price/Forward Earnings ratio, HMC is valued cheaply inside the industry as 92.68% of the companies are valued more expensively.
HMC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 6.31 | ||
| Fwd PE | 6.01 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of HMC indicates a rather cheap valuation: HMC is cheaper than 95.12% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 5.71 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
HMC has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.42
PEG (5Y)N/A
EPS Next 2Y4.5%
EPS Next 3Y4.58%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.43%, HMC is a good candidate for dividend investing.
HMC's Dividend Yield is rather good when compared to the industry average which is at 3.68. HMC pays more dividend than 95.12% of the companies in the same industry.
HMC's Dividend Yield is rather good when compared to the S&P500 average which is at 2.18.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.43% |
5.2 History
The dividend of HMC decreases each year by -14.82%.
HMC has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)-14.82%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
29.01% of the earnings are spent on dividend by HMC. This is a low number and sustainable payout ratio.
DP29.01%
EPS Next 2Y4.5%
EPS Next 3Y4.58%
HONDA MOTOR CO LTD-SPONS ADR
NYSE:HMC (10/21/2024, 5:15:52 PM)
After market: 30.5 0 (0%)30.5
-0.46 (-1.49%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupAutomobiles & Components
GICS IndustryAutomobiles
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap47.64B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.43% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
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EPS beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 6.31 | ||
| Fwd PE | 6.01 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.42
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.64% | ||
| ROE | 8.49% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 6.94% | ||
| PM (TTM) | 5.37% | ||
| GM | 21.74% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.37 | ||
| Quick Ratio | 1.07 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)29.96%
EPS 3Y-15.97%
EPS 5Y
EPS Q2Q%
EPS Next Y4.45%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)19.8%
Revenue growth 3Y15.76%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y