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Honda Motor (HMC) Sees a More Significant Dip Than Broader Market: Some Facts to Know

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Honda Motor (HMC - Free Report) closed at $36.83 in the latest trading session, marking a -1.07% move from the prior day. The stock trailed the S&P 500, which registered a daily loss of 0.2%. Meanwhile, the Dow experienced a drop of 0.6%, and the technology-dominated Nasdaq saw an increase of 0.11%.

Heading into today, shares of the automaker had gained 3.22% over the past month, outpacing the Auto-Tires-Trucks sector's loss of 1.71% and lagging the S&P 500's gain of 3.32% in that time.

Market participants will be closely following the financial results of Honda Motor in its upcoming release. The company's upcoming EPS is projected at $0.41, signifying a 19.61% drop compared to the same quarter of the previous year. Meanwhile, our latest consensus estimate is calling for revenue of $37.96 billion, up 14.5% from the prior-year quarter.

Any recent changes to analyst estimates for Honda Motor should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 1.29% decrease. At present, Honda Motor boasts a Zacks Rank of #3 (Hold).

Looking at valuation, Honda Motor is presently trading at a Forward P/E ratio of 8.89. This expresses a premium compared to the average Forward P/E of 5.95 of its industry.

We can also see that HMC currently has a PEG ratio of 0.43. 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. The Automotive - Foreign industry had an average PEG ratio of 0.41 as trading concluded yesterday.

The Automotive - Foreign industry is part of the Auto-Tires-Trucks sector. At present, this industry carries a Zacks Industry Rank of 59, placing it within the top 24% of over 250 industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.


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