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Honda Motor Company (HMC)
NYSE:HMC
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Honda Motor Company
(NYSE:HMC)
Rating:77Outperform
Price Target:
$39.00
▲(15.66% Upside)
Honda Motor Company (HMC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$53.65B
Dividend Yield4.11%
Average Volume (3M)1.04M
Price to Earnings (P/E)11.7
Beta (1Y)0.61
Revenue Growth1.68%
EPS Growth-39.28%
CountryUS
Employees194,993
SectorConsumer Cyclical
Sector Strength80
IndustryAuto - Manufacturers
Share Statistics
EPS (TTM)46.80
Shares Outstanding1,760,000,000
10 Day Avg. Volume780,948
30 Day Avg. Volume1,041,357
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.67
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit0.02
Enterprise Value/Ebitda0.05
Forecast
1Y Price Target
$39.00Price Target Upside15.66% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Honda Motor Company Business Overview & Revenue Model
Company DescriptionHonda Motor Company (HMC) is a multinational conglomerate primarily engaged in the manufacturing of automobiles, motorcycles, and power equipment. Founded in 1948 in Japan, Honda has established itself as one of the world's largest automotive manufacturers, with a diverse product lineup that includes passenger cars, commercial vehicles, and various types of motorcycles. The company is also active in the development of advanced technologies, including fuel cell vehicles and robotics, and has a growing presence in the power sports and marine sectors.
How the Company Makes MoneyHonda generates revenue primarily through the sale of its automotive and motorcycle products. The company's automotive division contributes a significant portion of its earnings, offering a wide range of vehicles from compact cars to SUVs and luxury models under the Acura brand. Additionally, Honda's motorcycle division is a leading player in the global market, providing a variety of motorcycles for different segments, including sport bikes and scooters. Other key revenue streams include sales of power equipment, such as generators and lawn mowers, as well as revenue from financing and leasing services offered through Honda Financial Services. Strategic partnerships with technology firms and investments in research and development further enhance Honda's competitive edge, allowing the company to innovate and diversify its offerings, which in turn drives sales and profitability.
Honda Motor Company Key Performance Indicators (KPIs)
Any
Revenue by Segment
Shows revenue contributions from each business area, indicating which segments are growing, stable, or declining, and providing insight into the company's strategic focus and market positioning.
Shows revenue contributions from each business area, indicating which segments are growing, stable, or declining, and providing insight into the company's strategic focus and market positioning.
Data provided by:
Main Street Data
Main Street DataHonda Motor Company Earnings Call Summary
Earnings Call Date:Aug 06, 2025
(Q1-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Negative
The earnings call reflected a mix of positive achievements such as the record operating profit in the Motorcycle segment and revised profit forecasts. However, these were overshadowed by significant challenges including a sharp decline in overall operating profit, losses in the Automobile segment, and ongoing tariff and currency issues.Q1-2026 Updates
Positive Updates
Record Operating Profit in Motorcycle Segment
The Motorcycle operations achieved a record high operating profit for a quarter period, driven by sales expansion in Brazil and Vietnam. The operating profit for motorcycles was JPY 189 billion, up by JPY 11.3 billion year-on-year.
Revised Forecast for Fiscal Year
Honda Motor Company revised its forecast for the full fiscal year ending March 2026, projecting an increase in operating profit to JPY 700 billion, up by JPY 200 billion from the previous forecast. The net profit for the year is expected to be JPY 420 billion, reflecting a JPY 170 billion increase.
Successful Share Buyback
Honda successfully acquired shares worth JPY 936.5 billion as part of its JPY 1.1 trillion share buyback program announced in December 2024.
Negative Updates
Significant Decline in Operating Profit
Honda's operating profit for the first quarter was JPY 244.1 billion, a decrease of JPY 240.5 billion compared to the same period last year.
Automobile Segment Losses
The Automobile operations reported an operating loss of JPY 29.6 billion, with sales declines primarily in China and other Asian regions.
Challenges with Tariffs and Currency Effects
Tariffs led to a decline in profit by JPY 124.6 billion, while currency effects resulted in a negative impact of JPY 86.1 billion.
Underperformance in China Market
Sales in China have been declining for 17 consecutive months, with challenges in meeting market expectations for EVs.
Company Guidance
In the recent financial results call, Honda Motor Company provided guidance for the fiscal year ending March 2026. The company revised its full-year forecast upwards, projecting an operating profit of JPY 700 billion, an increase of JPY 200 billion from the previous forecast, and a net profit of JPY 420 billion, up by JPY 170 billion. The forecast assumes an exchange rate of JPY 140 against the U.S. dollar. Honda's first-quarter operating profit stood at JPY 244.1 billion, though this was JPY 240.5 billion lower than the same period last year. Key factors influencing the operating profit included a positive impact of JPY 109.1 billion from increased unit sales in North America, a JPY 68.5 billion positive impact from pricing revisions, and negative impacts from expenses, tariffs, and currency effects totaling JPY 293.6 billion. The company also highlighted its substantial share buyback program, which, as of July 31, amounted to JPY 936.5 billion out of the resolved JPY 1.1 trillion. Honda's guidance reflects adjustments to tariff impacts and exchange rate assumptions, with continued challenges anticipated from policy changes and nonrecurring expenses related to electric vehicles (EVs).Honda Motor Company Financial Statement Overview
Summary
Honda Motor Company exhibits strong financial health with consistent income growth and solid balance sheet metrics. While profitability remains high, and leverage is managed well, cash flow volatility and rising liabilities present areas for improvement. The company is well-positioned in the auto manufacturing industry, but it must address cash flow management to sustain long-term growth.Income Statement
Honda Motor Company has shown consistent revenue growth over the years, with a notable increase from 2021 to 2025. The gross profit margin and net profit margin remained stable, showcasing efficient cost management. Despite a slight decline in EBIT margin in 2025, the EBITDA margin indicates strong operational performance. Overall, the company demonstrates robust income-generating capability with healthy profitability.78
Positive
Balance Sheet
Honda's balance sheet reflects a strong equity position, with the equity ratio showing a solid percentage of total assets funded by shareholders' equity. The debt-to-equity ratio has decreased over time, indicating improved leverage management. Return on equity is steady, reflecting efficient utilization of shareholder funds. However, there is a potential risk from total liabilities, which have increased alongside assets, suggesting a need for cautious financial management.72
Positive
Cash Flow
The cash flow analysis shows volatility in free cash flow, with a significant decline in 2025 due to increased capital expenditures. Operating cash flow remains positive but has decreased compared to previous years. The operating cash flow to net income ratio indicates effective cash generation relative to net income, though the decreasing trend suggests potential cash flow challenges. Overall, Honda's cash flow management is satisfactory but requires attention to maintain stability.65
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 21.62T | 21.69T | 20.43T | 16.91T | 14.55T | 13.17T |
| Gross Profit | 4.54T | 4.66T | 4.26T | 3.33T | 2.98T | 2.73T |
| EBITDA | 1.84T | 2.12T | 3.17T | 2.40T | 2.36T | 2.08T |
| Net Income | 637.85B | 835.84B | 1.11T | 651.42B | 707.07B | 657.42B |
Balance Sheet | ||||||
| Total Assets | 29.87T | 30.78T | 29.77T | 24.67T | 23.97T | 21.92T |
| Cash, Cash Equivalents and Short-Term Investments | 4.17T | 4.74T | 5.18T | 4.07T | 3.89T | 3.05T |
| Total Debt | 0.00 | 4.42T | 10.08T | 7.67T | 8.05T | 7.72T |
| Total Liabilities | 17.81T | 18.15T | 16.77T | 13.12T | 13.20T | 12.55T |
| Stockholders Equity | 11.80T | 12.33T | 12.70T | 11.23T | 10.47T | 9.08T |
Cash Flow | ||||||
| Free Cash Flow | -307.39B | -555.28B | 138.61B | 1.50T | 1.23T | 521.24B |
| Operating Cash Flow | 459.07B | 292.15B | 747.28B | 2.13T | 1.68T | 1.07T |
| Investing Cash Flow | -959.45B | -941.97B | -867.27B | -678.06B | -376.06B | -796.88B |
| Financing Cash Flow | -126.59B | 280.48B | 918.65B | -1.47T | -615.72B | -283.98B |
Honda Motor Company Technical Analysis
Positive
33.72
Price Trends
31.78
Positive
30.67
Positive
28.83
Positive
Market Momentum
0.59
Positive
55.65
Neutral
26.31
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HMC, the sentiment is Positive. The current price of 33.72 is above the 20-day moving average (MA) of 33.43, above the 50-day MA of 31.78, and above the 200-day MA of 28.83, indicating a bullish trend. The MACD of 0.59 indicates Positive momentum. The RSI at 55.65 is Neutral, neither overbought nor oversold. The STOCH value of 26.31 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HMC.
Honda Motor Company Risk Analysis
Honda Motor Company disclosed 22 risk factors in its most recent earnings report. Honda Motor Company reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
3. Laws and Regulations Concerning Human Rights Q1, 2023
2.
1. Economic Security Q1, 2023
3.
Geopolitical Risk Q1, 2023
Honda Motor Company Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $254.03B | 8.97 | 12.05% | 2.79% | 4.14% | -12.12% | |
77 Outperform | $53.65B | 11.73 | 5.17% | 4.11% | 1.68% | -39.28% | |
76 Outperform | $1.08T | 193.35 | 8.43% | ― | -2.73% | -51.64% | |
75 Outperform | $55.78B | 9.29 | 7.07% | 0.87% | 5.34% | -28.29% | |
73 Outperform | $46.84B | 15.02 | 7.11% | 6.40% | 2.72% | -17.58% | |
67 Neutral | $23.57B | 22.17 | 11.91% | ― | 7.49% | -21.06% | |
61 Neutral | $17.87B | 13.25 | -4.88% | 3.05% | 1.25% | -14.67% |
* Consumer Cyclical Sector Average
Performance Comparison
HMC
Honda Motor Company
33.72
3.19
10.45%
F
Ford Motor
11.72
1.55
15.24%
GM
General Motors
58.53
10.59
22.09%
TSLA
Tesla
329.36
109.95
50.11%
TM
Toyota Motor
193.57
8.86
4.80%
LI
Li Auto
24.40
5.63
29.99%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.