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MarketScreener Homepage  >  Equities  >  Tokyo Stock Exchange  >  Honda Motor Co., Ltd.    7267   JP3854600008

HONDA MOTOR CO., LTD.

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Honda sees 68% drop in annual profit as coronavirus slams car sales

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08/05/2020 | 01:59am EDT
Honda's logo on its Modulo model is pictured at its showroom at its headquarters in Tokyo

Japan's Honda Motor Co on Wednesday forecast a 68% decrease in annual operating profit to a 10-year low with global demand for cars expected to slide because of the coronavirus pandemic.

The country's No. 3 automaker expects profit to sink to 200 billion yen ($1.89 billion) in the year to end-March 2021, its weakest since the 2010/11 year and undershooting analyst estimates.

Honda is bracing for a 6% decrease in annual vehicle sales after a 40% plunge in the June quarter, which resulted in a 113.7 billion yen operating loss.

Global automakers are taking a big hit from the coronavirus outbreak, which shuttered vehicle factories this year and has kept customers out of car dealerships.

The maker of the CR-V SUV crossover and the Fit compact hatchback expects to sell 4.5 million vehicles this year, versus 4.79 million last year. It predicts a 16% sales slide in North America, a key market where the United States is struggling to control a surge in virus infections.

"If the current situation continues as is, we think the situation will not get worse (than we saw earlier this year), but it will take time for demand to recover to pre-pandemic levels," Executive Vice President Seiji Kuraishi told a livestreamed briefing.

Despite weaker sales in North America, Honda expects annual sales in Asia to increase 8%.

China, one of Honda's biggest markets, has become a rare bright spot for many global automakers, as demand in the world's biggest car market has been recovering faster than in other countries.

Honda sank into the red for the second straight quarter and posted its worst operating loss since the March 2009 quarter.

Despite its dire outlook, Honda is weathering the coronavirus pandemic better than rivals Nissan Motor Co, Mitsubishi Motor Corp and Mazda Motor Corp, which last week forecast record operating losses for the year.

By Naomi Tajitsu

Stocks mentioned in the article
ChangeLast1st jan.
HONDA MOTOR CO., LTD. 1.73% 2474.5 End-of-day quote.-20.15%
MAZDA MOTOR CORPORATION -0.16% 606 End-of-day quote.-35.39%
NISSAN MOTOR CO., LTD. -0.38% 363.6 End-of-day quote.-42.84%
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Financials
Sales 2021 12 435 B 118 B 118 B
Net income 2021 239 B 2 262 M 2 262 M
Net Debt 2021 4 511 B 42 725 M 42 725 M
P/E ratio 2021 16,6x
Yield 2021 1,99%
Capitalization 4 274 B 40 462 M 40 480 M
EV / Sales 2021 0,71x
EV / Sales 2022 0,66x
Nbr of Employees 218 674
Free-Float 91,2%
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Honda Motor Co., Ltd. Technical Analysis Chart | MarketScreener
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Technical analysis trends HONDA MOTOR CO., LTD.
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TrendsBearishNeutralNeutral
Income Statement Evolution
Consensus
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Mean consensus BUY
Number of Analysts 17
Average target price 3 421,88 JPY
Last Close Price 2 474,50 JPY
Spread / Highest target 57,6%
Spread / Average Target 38,3%
Spread / Lowest Target 1,03%
EPS Revisions
Managers
NameTitle
Takahiro Hachigo President, CEO, Representative Director, Head-R&D
Toshiaki Mikoshiba Chairman & Head-External Affairs
Seiji Kuraishi COO, Representative Director, VP & GM-Automobile
Kohei Takeuchi Senior MD, Head-Finance & Administration
Yusuke Hori Executive Officer & GM-Information Technology
Sector and Competitors
1st jan.Capitalization (M$)
HONDA MOTOR CO., LTD.-20.15%40 462
TOYOTA MOTOR CORPORATION-8.85%183 618
VOLKSWAGEN AG-24.36%83 255
DAIMLER AG-10.50%55 436
BMW AG-19.25%45 664
GENERAL MOTORS COMPANY-20.77%41 659