Honda Motor Company develops, manufactures, and distributes motorcycles, automobiles, power, and other products worldwide. The company operates through four segments: Motorcycle Business, Automobile Business, Financial Services Business, and Power product and Other Businesses. The company was founded in 1946 and is based in Tokyo, Japan.
HMC Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Honda Motor Co Ltd with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Honda Motor Co Ltd ranked in the 98th percentile in terms of potential gain offered. Our DCF model suggests the stock is undervalued by 22964.5%; returns of such proportions should be viewed with some skepticism, though. The most interesting components of our discounted cash flow analysis for Honda Motor Co Ltd ended up being:
39% of the company's capital comes from equity, which is greater than merely 15.99% of stocks in our cash flow based forecasting set.
Honda Motor Co Ltd's weighted average cost of capital (WACC) is 6%; for context, that number is higher than merely 0.32% of tickers in our DCF set.
The company's cost of debt, derived from its interest coverage, tax rate, and market capitalization, is greater than only 0% of stocks in its sector (Consumer Cyclical).
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Honda Motor Co Ltd? See SIC, MSC, RLH, BGFV, and TCS.
Honda (HMC) will withdraw from Formula One (FWONA) at the end of the 2021 season as it shifts to a goal of carbon neutrality.Honda supplies engines to Red Bull Racing and Scuderia AlphaTauri.In its statement, HMC noted: “Toward this end, Honda needs to funnel its corporate resources in research and...
One of the most prominent engine manufacturers in Formula 1, Honda, has sensationally announced its decision to end its participation in F1 from the end of the 2021 season to focus on zero-emission technology. Read Full Article at RT.com
Engine supplier more interested in carbon-neutral market Red Bull face a struggle to find a competitive alternative Honda, which supplies engines to Red Bull and AlphaTauri, has announced it is to pull out of Formula One at the end of 2021 in a major shock which carries weighty ramifications for both Red Bull and the sport. Only three engine manufacturers remain in F1 and Red Bull face limited options in engine supply, while the sport must now consider which direction it takes in power units to ensure its future. Honda returned to Formula One in 2015 with McLaren and endured three difficult years during which their engine was well off the pace. When McLaren dropped them they supplied Toro Rosso for one year in 2018 and Red Bull took them on as a works partner in 2019, since when they ha...