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Toyota, Microsoft to Jointly Boost Connected Car Experience

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Toyota Motor Corporation (TM - Free Report) recently entered into a new patent licensing deal with technological behemoth, Microsoft Corporation (MSFT - Free Report) . The agreement is related to connected car technologies.

Per the licensing deal, Microsoft will provide telematics, infotainment, safety and other systems to Toyota. This will help the company to offer alluring connected car experience to its customers.

In Apr 2016, Toyota launched its data science hub for global operations in the form of a new company – Toyota Connected, Inc. – headquartered in Plano, TX. The company has joined forces with Microsoft to boost telematics research, network security and data analytics in order to deliver Internet-connected car solutions.

The duo is aimed at boosting the connected car experience by combining computer and wireless technology to provide information, entertainment, and real time traffic updates to vehicles in motion. Moreover, Toyota’s focus on product development, capacity enhancement and expansion in emerging markets will drive growth.

However, Toyota has underperformed the Zacks classified Auto Manufacturers-Foreign sub-industry in the last one year with respect to price performance, mainly due to weak guidance for fiscal 2017 and frequent product recalls. The stock gained around 4%, while the industry rose 6.7%.


 

Toyota currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the same space include American Axle & Manufacturing Holdings, Inc. (AXL - Free Report) and Lear Corp. (LEA - Free Report) . Both the stocks flaunt a Zacks Rank #1 (Strong Buy).  You can see the complete list of today’s Zacks #1 Rank stocks here.

American Axle & Manufacturing has a positive average earnings surprise of 9.18% for the last four quarters. Lear Corp. generated a positive average earnings surprise of 11.70% for the trailing four quarters.

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