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Honda to Gain From Vision 2030 Plan, Vehicle Recalls a Woe
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On Jan 2, we issued an updated research report on Honda Motor Company (HMC - Free Report) .
The stock has not seen any revision in the Zacks Consensus Estimate for third-quarter fiscal 2018 as well as for current fiscal earnings over the last 30 days.
The company’s Vision 2030 plan aims to focus more on development of electric vehicles (EVs), plug-in hybrid and hydrogen fuel cell vehicles. By 2018, Honda has plans to unveil two new electric cars, one for the Chinese market and the other for Europe. These initiatives taken by the company are in line with its increased focus on the development and launch of EVs by its counterparts.
Further, its Vision 2030 plan aims at reducing its development costs by focusing more on the coordination between research and development as well as procurement and manufacturing of its products.
The company emphasizes on increasing shareholder returns and aims to maintain a return ratio of approximately 30%. The company pays regular cash dividends to its shareholders.
Apart from dividend payments, Honda is also in progress with its first share repurchase program, expected to close on Jan 31, 2018. Under this program, it intends to buy 24 million of common shares.
However, frequent vehicle recalls over the past few years have been hampering the customer’s confidence in the company, apart from adding to its expenses. The most recent recall was in November 2017, wherein it recalled around 900,000 Odyssey minivans worldwide.
Other concerns that the company is facing includes higher R&D expenses and unfavorable foreign currency translation issues.
For fiscal 2018 ending Mar 31, 2018, the company expects annual revenues to perk up 7.5% from the last fiscal. While profit before income taxes is projected to decline 5.2% from the same period a year ago.
Price Performance
Shares of Honda have rallied 14.7% in the last three months, outperforming the 7.7% gain of the industry it belongs to.
Toyota has an expected long-term growth rate of 6.2%. Over a month, shares of the company have gained 3.6%.
BorgWarner has an expected long-term growth rate of 8.6%. In the last six months, shares of the company have jumped 20%.
Volkswagen has an expected long-term growth rate of 12.9%. In the last three months, shares of the company have increased 17.9%.
Investor Alert: Breakthroughs Pending
A medical advance is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating substantial revenue, and even more wondrous products are in the pipeline.
Cures for a variety of deadly diseases are in sight, and so are big potential profits for early investors. Zacks names 5 stocks to buy now.
Image: Bigstock
Honda to Gain From Vision 2030 Plan, Vehicle Recalls a Woe
On Jan 2, we issued an updated research report on Honda Motor Company (HMC - Free Report) .
The stock has not seen any revision in the Zacks Consensus Estimate for third-quarter fiscal 2018 as well as for current fiscal earnings over the last 30 days.
The company’s Vision 2030 plan aims to focus more on development of electric vehicles (EVs), plug-in hybrid and hydrogen fuel cell vehicles. By 2018, Honda has plans to unveil two new electric cars, one for the Chinese market and the other for Europe. These initiatives taken by the company are in line with its increased focus on the development and launch of EVs by its counterparts.
Honda Motor Company, Ltd. Price and Consensus
Honda Motor Company, Ltd. Price and Consensus | Honda Motor Company, Ltd. Quote
Further, its Vision 2030 plan aims at reducing its development costs by focusing more on the coordination between research and development as well as procurement and manufacturing of its products.
The company emphasizes on increasing shareholder returns and aims to maintain a return ratio of approximately 30%. The company pays regular cash dividends to its shareholders.
Apart from dividend payments, Honda is also in progress with its first share repurchase program, expected to close on Jan 31, 2018. Under this program, it intends to buy 24 million of common shares.
However, frequent vehicle recalls over the past few years have been hampering the customer’s confidence in the company, apart from adding to its expenses. The most recent recall was in November 2017, wherein it recalled around 900,000 Odyssey minivans worldwide.
Other concerns that the company is facing includes higher R&D expenses and unfavorable foreign currency translation issues.
For fiscal 2018 ending Mar 31, 2018, the company expects annual revenues to perk up 7.5% from the last fiscal. While profit before income taxes is projected to decline 5.2% from the same period a year ago.
Price Performance
Shares of Honda have rallied 14.7% in the last three months, outperforming the 7.7% gain of the industry it belongs to.
Zacks Rank & Key Picks
Honda carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the auto space are Toyota Motor Corporation (TM - Free Report) , BorgWarner Inc. (BWA - Free Report) and Volkswagen AG , all carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Toyota has an expected long-term growth rate of 6.2%. Over a month, shares of the company have gained 3.6%.
BorgWarner has an expected long-term growth rate of 8.6%. In the last six months, shares of the company have jumped 20%.
Volkswagen has an expected long-term growth rate of 12.9%. In the last three months, shares of the company have increased 17.9%.
Investor Alert: Breakthroughs Pending
A medical advance is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating substantial revenue, and even more wondrous products are in the pipeline.
Cures for a variety of deadly diseases are in sight, and so are big potential profits for early investors. Zacks names 5 stocks to buy now.
Click here to see them >>