Honda Motor (NYSE: HMC) shares currently have a dividend yield of 5.40%. Honda Motor Co., Ltd. engages in the manufacture and sale of motorcycles, automobiles, and power products. It operates through four segments: Motorcycle Business, Automobile Business, Financial Services Business, and Power Product and Other Businesses. The company has a P/E ratio of 10.40. The average volume for Honda Motor has been 433,400 shares per day over the past 30 days. Honda Motor has a market cap of $66.8 billion and is part of the automotive industry. Shares are up 0.3% year to date as of the close of trading on Thursday. TheStreet Ratings rates Honda Motor as a buy. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income. Highlights from the ratings report include:
- Net operating cash flow has increased to $3,066.12 million or 38.68% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 18.47%.
- The debt-to-equity ratio is somewhat low, currently at 0.98, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.84 is somewhat weak and could be cause for future problems.
- HONDA MOTOR CO LTD's earnings per share declined by 25.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, HONDA MOTOR CO LTD increased its bottom line by earning $2.17 versus $1.41 in the prior year. This year, the market expects an improvement in earnings ($2.48 versus $2.17).
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 8.8%. Since the same quarter one year prior, revenues slightly dropped by 6.4%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- You can view the full Honda Motor Ratings Report.
- Our dividend calendar.
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