Honda Motor Co (7267) AI Stock Analysis

• Market Cap: $6.50T
• Dividend Yield: 4.43%
• Average Volume (3M): 14.47M
• Price to Earnings (P/E): 11.2
• Beta (1Y): 1.18
• Revenue Growth: 1.96%
• EPS Growth: -39.57%
• Country: JP
• Employees: 194,993
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Manufacturers
• EPS (TTM): 29.50
• Shares Outstanding: 5,280,000,000
• 10 Day Avg. Volume: 15,290,380
• 30 Day Avg. Volume: 14,470,826
• PEG Ratio: -0.36
• Price to Book (P/B): 0.51
• Price to Sales (P/S): 0.29
• P/FCF Ratio: -28.68
• Enterprise Value/Market Cap: 2.06
• Enterprise Value/Revenue: 0.62
• Enterprise Value/Gross Profit: 2.95
• Enterprise Value/Ebitda: 7.27
• 1Y Price Target: $1,879.53
• Price Target Upside: 18.58% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 65 Neutral
• Price Target: ¥1,677.00 ▲(5.80% Upside)

Honda Motor Co's overall stock score reflects a mixed financial performance with stable balance sheet metrics but declining revenue growth and liquidity concerns. The technical analysis suggests potential short-term weakness, while the valuation remains attractive. The earnings call provided some optimism, particularly in the motorcycle segment, but was offset by challenges in the automobile sector.

Positive Factors

Motorcycle Segment Growth

The strong performance in the motorcycle segment highlights Honda's ability to capitalize on growth opportunities in emerging markets, providing a stable revenue stream and offsetting challenges in other segments.

Revised Profit Forecast

The upward revision of the profit forecast indicates confidence in operational improvements and strategic initiatives, suggesting potential for enhanced profitability and shareholder value.

Stable Balance Sheet

A stable balance sheet with a balanced debt-to-equity ratio provides financial resilience, allowing Honda to navigate economic uncertainties and invest in growth opportunities.

Negative Factors

Automobile Segment Losses

Operating losses in the automobile segment, driven by tariffs and EV expenses, highlight ongoing challenges in maintaining profitability and adapting to regulatory changes.

Declining Revenue Growth

A significant decline in revenue growth suggests potential difficulties in market expansion and sales execution, impacting long-term growth prospects.

Negative Free Cash Flow

Negative free cash flow reflects challenges in cash generation, limiting Honda's ability to fund operations, invest in growth, and return capital to shareholders.

Honda Motor Co Business Overview & Revenue Model

Company Description

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. The Automobile Business segment offers passenger cars, light trucks, and mini vehicles. The Financial Services Business segment provides various financial services, including retail lending and leasing services to customers, as well as wholesale financing services to dealers. The Life Creation and Other Businesses segment manufactures and sells power products, such as general purpose engines, generators, water pumps, lawn mowers, riding mowers, robotic mowers, brush cutters, tillers, snow blowers, outboard marine engines, walking assist devices, and portable battery inverter power sources. This segment also offers HondaJet aircraft. The company also sells spare parts; and provides after-sale services through retail dealers directly, as well as through independent distributors and licensees. Honda Motor Co., Ltd. was founded in 1946 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Honda generates revenue through multiple key streams, primarily from the sale of automobiles and motorcycles. The automotive segment, which includes both passenger cars and light trucks, represents the largest portion of its revenue, driven by popular models such as the Honda Civic and CR-V. The motorcycle segment also contributes significantly, known for its extensive range of motorbikes catering to various markets. Additionally, Honda earns income from power equipment sales, including generators and lawn mowers. The company has strategic partnerships and collaborations that enhance its product offerings and market reach, including joint ventures in emerging markets. Furthermore, Honda's investment in research and development, particularly in electric and hybrid vehicle technologies, positions it to capitalize on evolving consumer preferences and regulatory trends, contributing to long-term profitability.

Honda Motor Co Financial Statement Overview

Summary

Honda Motor Co's financial performance is mixed. The income statement shows stable but unexceptional profit margins, with a concerning 29.8% decline in revenue growth. The balance sheet is stable with a balanced debt-to-equity ratio, but cash flow issues are evident with negative free cash flow, indicating liquidity challenges.

Income Statement

Honda Motor Co's income statement shows a mixed performance. The TTM data indicates a gross profit margin of 21.5% and a net profit margin of 3.85%, which are stable but not exceptional. However, the revenue growth rate has declined by 29.8% in the TTM period, indicating potential challenges in sales growth. EBIT and EBITDA margins are moderate at 6.20% and 9.35% respectively, suggesting reasonable operational efficiency but room for improvement.

Balance Sheet

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.93, indicating a balanced approach to leveraging. The return on equity is modest at 6.53%, showing moderate profitability. The equity ratio stands at 39.5%, suggesting a solid capital structure with a good proportion of assets financed by equity.

Cash Flow

Cash flow analysis reveals some concerns, particularly with free cash flow being negative in the TTM period, indicating potential liquidity issues. The operating cash flow to net income ratio is low at 3.39%, suggesting limited cash generation relative to net income. The free cash flow to net income ratio is negative, highlighting challenges in converting income into free cash flow.

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	4.41T	3.33T	2.98T	2.73T
EBITDA	1.84T	2.12T	2.50T	1.64T	1.70T	1.55T
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	11.55T	11.77T	10.08T	7.62T	8.05T	8.04T
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	-201.78B	-218.65B	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 Co Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1585.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7267, the sentiment is Neutral. The current price of 1585 is above the 20-day moving average (MA) of 1573.20, below the 50-day MA of 1594.50, and above the 200-day MA of 1459.37, indicating a neutral trend. The MACD of -2.18 indicates Positive momentum. The RSI at 46.16 is Neutral, neither overbought nor oversold. The STOCH value of 29.13 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7267.

Honda Motor Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7203	81 Outperform	¥41.12T	9.68	12.89%	3.01%	6.44%	11.88%
7270	80 Outperform	¥2.36T	7.68	11.75%	3.78%	2.01%	-19.94%
7269	75 Outperform	$4.34T	10.59	12.95%	1.97%	2.99%	9.99%
6201	69 Neutral	$5.28T	25.00	3.94%	0.83%	2.91%	-11.26%
7267	65 Neutral	$6.50T	11.23	5.17%	4.43%	1.96%	-39.57%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
7201	46 Neutral	$1.23T	-1.51	-15.23%	―	-3.33%	-356.10%

Honda Motor Co Corporate Events

Honda Completes Share Acquisition as Part of Strategic Buyback Plan

Honda Motor Co., Ltd. has completed the acquisition of its own shares, as authorized by the Board of Directors in December 2024. The company acquired 22,943,700 shares of common stock, amounting to 38,565,665,858 yen, between September 1 and September 10, 2025. This move is part of a larger plan to acquire up to 1,100,000,000 shares, representing 23.7% of the total issued shares, with a total budget of up to 1,100 billion yen, to be completed by December 23, 2025.

The most recent analyst rating on (JP:7267) stock is a Buy with a Yen2000.00 price target. To see the full list of analyst forecasts on Honda Motor Co stock, see the JP:7267 Stock Forecast page.

Honda Announces Progress in Share Buyback Program

Honda Motor Co., Ltd. has announced the status of its share buyback program, acquiring 76,882,000 shares of common stock for approximately 124.9 billion yen between August 1 and August 31, 2025. This acquisition is part of a larger plan to buy back up to 1.1 billion shares, representing 23.7% of its issued shares, by the end of 2025, with the aim of enhancing shareholder value and optimizing capital structure.

The most recent analyst rating on (JP:7267) stock is a Hold with a Yen1600.00 price target. To see the full list of analyst forecasts on Honda Motor Co stock, see the JP:7267 Stock Forecast page.

Honda Motor Co. Reports Decline in Q1 Earnings

Honda Motor Co., Ltd., a leading Japanese multinational corporation, is renowned for its automobiles, motorcycles, and power equipment, operating primarily in the automotive and financial services sectors. The company is listed on the Tokyo Stock Exchange and is known for its innovative engineering and global presence.

Honda Motor Co. Revises Financial Forecast Upward for FY 2026

Honda Motor Co. has revised its financial forecast for the fiscal year ending March 31, 2026, significantly increasing its profit expectations due to favorable tariff impacts and foreign exchange conditions. This upward revision reflects a positive outlook for the company’s financial performance, suggesting potential benefits for stakeholders and strengthening its competitive position in the market.

The most recent analyst rating on (JP:7267) stock is a Buy with a Yen1750.00 price target. To see the full list of analyst forecasts on Honda Motor Co stock, see the JP:7267 Stock Forecast page.

Honda Reports Sharp Decline in Q1 Financial Results

Honda Motor Co. reported a significant decline in its financial performance for the first quarter ended June 30, 2025, with operating profit and profit before income taxes dropping by nearly 50% compared to the previous year. This downturn is attributed to various market challenges, impacting stakeholders and potentially influencing the company’s strategic decisions moving forward.

The most recent analyst rating on (JP:7267) stock is a Buy with a Yen1750.00 price target. To see the full list of analyst forecasts on Honda Motor Co stock, see the JP:7267 Stock Forecast page.

Honda Announces Progress in Share Buyback Program

Honda Motor Co., Ltd. announced the acquisition of its own shares, acquiring 93,027,200 shares of common stock for 143,513,664,355 yen from July 1 to July 31, 2025. This move is part of a larger plan approved by the Board of Directors to acquire up to 1,100,000,000 shares by the end of 2025, aiming to enhance shareholder value and optimize capital structure.

The most recent analyst rating on (JP:7267) stock is a Buy with a Yen1750.00 price target. To see the full list of analyst forecasts on Honda Motor Co stock, see the JP:7267 Stock Forecast page.