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Is Honda Motor Co. (HMC) Stock Undervalued Right Now?
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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
Honda Motor Co. (HMC - Free Report) is a stock many investors are watching right now. HMC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 7.63. This compares to its industry's average Forward P/E of 9.23. HMC's Forward P/E has been as high as 9.18 and as low as 6.87, with a median of 7.66, all within the past year.
Investors should also note that HMC holds a PEG ratio of 0.37. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. HMC's industry has an average PEG of 0.48 right now. Over the last 12 months, HMC's PEG has been as high as 1.36 and as low as 0.32, with a median of 0.46.
Investors should also recognize that HMC has a P/B ratio of 0.71. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.64. Over the past year, HMC's P/B has been as high as 0.74 and as low as 0.52, with a median of 0.61.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. HMC has a P/S ratio of 0.44. This compares to its industry's average P/S of 0.77.
Finally, our model also underscores that HMC has a P/CF ratio of 4.57. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 8.22. Over the past year, HMC's P/CF has been as high as 5.30 and as low as 4, with a median of 4.38.
These are only a few of the key metrics included in Honda Motor Co.'s strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, HMC looks like an impressive value stock at the moment.
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Is Honda Motor Co. (HMC) Stock Undervalued Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
Honda Motor Co. (HMC - Free Report) is a stock many investors are watching right now. HMC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 7.63. This compares to its industry's average Forward P/E of 9.23. HMC's Forward P/E has been as high as 9.18 and as low as 6.87, with a median of 7.66, all within the past year.
Investors should also note that HMC holds a PEG ratio of 0.37. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. HMC's industry has an average PEG of 0.48 right now. Over the last 12 months, HMC's PEG has been as high as 1.36 and as low as 0.32, with a median of 0.46.
Investors should also recognize that HMC has a P/B ratio of 0.71. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.64. Over the past year, HMC's P/B has been as high as 0.74 and as low as 0.52, with a median of 0.61.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. HMC has a P/S ratio of 0.44. This compares to its industry's average P/S of 0.77.
Finally, our model also underscores that HMC has a P/CF ratio of 4.57. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 8.22. Over the past year, HMC's P/CF has been as high as 5.30 and as low as 4, with a median of 4.38.
These are only a few of the key metrics included in Honda Motor Co.'s strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, HMC looks like an impressive value stock at the moment.