Honda Motor Co (7267) AI Stock Analysis

• Market Cap: $6.21T
• Dividend Yield: 4.38%
• Average Volume (3M): 14.47M
• Price to Earnings (P/E): 10.1
• Beta (1Y): 1.17
• Revenue Growth: -0.43%
• EPS Growth: -26.68%
• 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: 2.15
• Enterprise Value/Revenue: 0.62
• Enterprise Value/Gross Profit: 2.95
• Enterprise Value/Ebitda: 7.27
• 1Y Price Target: $1,836.13
• Price Target Upside: 16.80% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 63 Neutral
• Price Target: ¥1,619.00 ▲(2.99% Upside)

Honda Motor Co's overall stock score reflects a mixed financial performance with stable balance sheet metrics but significant revenue growth decline and cash flow concerns. The technical analysis indicates weak momentum, while the valuation is a strong point with a low P/E ratio and high dividend yield. The absence of earnings call and corporate events data limits further insights.

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. is a leading Japanese multinational corporation primarily engaged in the manufacturing of automobiles, motorcycles, and power equipment. Founded in 1948, Honda has established a strong global presence, offering a diverse range of products including cars, motorcycles, and various types of engines. In addition to its core automotive and motorcycle sectors, Honda also invests in research and development for advanced technologies, including robotics and electric vehicles, aiming to enhance mobility and sustainability.

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: Positive
• Last Price: 1572.00
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• 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 Positive. The current price of 1572 is above the 20-day moving average (MA) of 1537.93, above the 50-day MA of 1552.86, and above the 200-day MA of 1477.01, indicating a bullish trend. The MACD of -2.06 indicates Negative momentum. The RSI at 54.60 is Neutral, neither overbought nor oversold. The STOCH value of 56.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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	80 Outperform	¥41.12T	9.68	12.89%	3.05%	6.44%	11.88%
7270	80 Outperform	$2.47T	8.98	9.73%	3.61%	1.04%	-31.52%
7269	75 Outperform	$4.34T	10.59	12.95%	1.88%	2.99%	9.99%
6201	74 Outperform	$5.28T	25.00	3.94%	0.80%	2.91%	-11.26%
7267	63 Neutral	$6.21T	10.15	5.23%	4.38%	-0.43%	-26.68%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
7201	49 Neutral	$1.23T	-1.51	-16.69%	―	-3.01%	-755.71%

Honda Motor Co Corporate Events

Honda Reports Decline in First-Half Fiscal Year 2025 Financial Results

Honda Motor Co. reported a decline in its financial performance for the first half of the fiscal year ending September 30, 2025, with significant decreases in sales revenue, operating profit, and profit before income taxes compared to the previous year. Despite the downturn, the company showed a notable increase in comprehensive income, indicating potential resilience in certain areas. The announcement highlights challenges in maintaining profitability and the need for strategic adjustments to improve financial health and stakeholder confidence.

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.