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Toyota Motor Corporation (TM) Stock Drops Despite Market Gains: Important Facts to Note

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Toyota Motor Corporation (TM - Free Report) ended the recent trading session at $194.14, demonstrating a -0.54% swing from the preceding day's closing price. The stock's change was less than the S&P 500's daily gain of 0.25%. Elsewhere, the Dow gained 0.15%, while the tech-heavy Nasdaq added 0.03%.

Prior to today's trading, shares of the company had lost 11.47% over the past month. This has lagged the Auto-Tires-Trucks sector's loss of 2.37% and the S&P 500's gain of 3.34% in that time.

The upcoming earnings release of Toyota Motor Corporation will be of great interest to investors. On that day, Toyota Motor Corporation is projected to report earnings of $4.01 per share, which would represent a year-over-year decline of 43.12%. Meanwhile, our latest consensus estimate is calling for revenue of $72.48 billion, down 5.69% from the prior-year quarter.

For the full year, the Zacks Consensus Estimates are projecting earnings of $22.07 per share and revenue of $319.48 billion, which would represent changes of -12.94% and +2.37%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Toyota Motor Corporation. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 20.82% upward. Toyota Motor Corporation is currently a Zacks Rank #3 (Hold).

In terms of valuation, Toyota Motor Corporation is presently being traded at a Forward P/E ratio of 8.84. This represents a premium compared to its industry's average Forward P/E of 6.96.

Investors should also note that TM has a PEG ratio of 0.34 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As the market closed yesterday, the Automotive - Foreign industry was having an average PEG ratio of 0.6.

The Automotive - Foreign industry is part of the Auto-Tires-Trucks sector. With its current Zacks Industry Rank of 167, this industry ranks in the bottom 34% of all industries, numbering over 250.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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