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Toyota (TM) November Sales Volume Up 9.2% Y/Y in North America

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Toyota Motor Corporation (TM - Free Report) reported total unit sales of 207,857 in North America, this November. This marks a year-over-year increase of 9.2% on a volume basis and 5% on a daily selling rate (DSR) basis.

Notably, the company’s Toyota and Lexus divisions reported record sales volume in November 2019.  The Toyota division recorded sales volume of 177,764 vehicles, indicating a year-over-year rise of 8.4% on a volume basis and 4.2% on a DSR basis. Meanwhile, the Lexus division registered unit sales of 30,093 vehicles, reflecting an increase of 13.8% on a volume basis and 9.4% on a DSR basis compared with the year-ago levels.

The Toyota division’s growth has been primarily aided by a 26.4% increase in the RAV4 model sales, which in turn was backed by 10,057 unit sales of RAV4 Hybrid. The 4Runner, Tacoma and C-HR sales went up 7.8%, 5.3% and 5.8%, respectively, marking their best ever November. Furthermore, revenues from Corolla rallied 17.3%, while Prius sales were up 11.9% in the month. The Camry and Land Cruiser November sales also shot up 4.3% and 2.8%, respectively.

All things considered, the Toyota division registered a rise in total car, SUV and hybrid sales by 8.6%, 14.1% and 68.4%, respectively. Lastly, the division’s light truck sales were up 8.3%, recording its best-ever sales in the month.

With respect to the Lexus division, NX model’s sales grew 14.2%, owing to NX Hybrid unit sales of 1,051. RX sales climbed 12.5%, boosted by RX Hybrid sales of 1,641 units. GX, RC and ES sales jumped 34.6%, 111.3% and 7.7%, respectively. On the whole, the Lexus division recorded total sales growth of 24%, while total hybrid sales surged 51.4%, indicating their best ever November performance.

Toyota Motors’ healthy balance sheet and improving cash flows, along with its investor-friendly moves, are fueling the company’s growth. With $36.8 billion of cash in hand, along with a modest leverage of 34%, the firm can tap onto growth opportunities. At the end of the first half of fiscal 2020, operating cash flow was ¥2 trillion ($19 billion), up 13.2% year over year.

Anticipating a slowdown in India, Indonesia and Thailand, the company had earlier narrowed the annual vehicle sales target. For fiscal 2020, Toyota Motors expects consolidated vehicle sales to be 8.95 million units, down from the previous forecast of 9 million units. The company’s forecast of consolidated net revenues of ¥29.5 trillion, operating income of ¥2.4 trillion and net income of ¥2.15 trillion remains intact.

Zacks Rank and Stocks to Consider

Currently, Toyota Motors carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Auto-Tires-Trucks sector are BRP Inc. (DOOO - Free Report) , Spartan Motors, Inc. (SPAR - Free Report) and SPX Corporation (SPXC - Free Report) . While BRP flaunts a Zacks Rank #1 (Strong Buy), Spartan Motors and SPX carry a Zacks Rank #2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

BRP has a projected earnings growth rate of 20.17% for the current year. Its shares have gained 46.6% over the past year.

Spartan Motors has an estimated earnings growth rate of 85.42% for the ongoing year. The company’s shares have surged 127.9% in a year’s time.

SPX has an expected earnings growth rate of 23.18% for 2019. The stock has appreciated 71.5% in the past year.

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