NEW YORK (TheStreet) -- Honda Motor Co. (HMC) shares are down 1.92% to $33.21 in early market trading on Friday after the Japanese automotive company said that it would restate its financial results for the previous fiscal year to account for the expanded recall of vehicles with faulty Takata Corp. (TKTDY) airbags.
The company attributed an additional $363 million in spending due to charges related to a U.S. recall of vehicles with the faulty Takata supplied airbags.
Honda said that the costs had to be booked for the fiscal year ended March 31 rather than the current year due to U.S. accounting rules, with the revised earnings figures to be disclosed by the end of this month.
The company also said that the revised results will affect neither its dividend payout for fiscal 2014 or the forecast for its current fiscal year.
Insight from TheStreet Research Team:
Real Money Pro's Paul Price recently wrote about Honda, here is what he had to say:
"Honda Motor Company (HMC), which also produces high-end brand Acura, make some of the best cars in the world. You would probably expect that their stocks had boomed right along with the worldwide surge in vehicle sales. A peek at their charts, however, tells a very different story. The auto business is among the most cyclical. Daimler went from earning $5.55 per share in 2007 to a $1.74 loss in 2009. Honda's recession occurred between 2007 and 2008. It avoided running a deficit, but EPS plunged from $3.30 to $0.77," Price said.
- Paul Price, 'Consider Selling Your Auto Stocks', 5/28/2015