Zacks Investment Research Lowers Honda Motor (HMC) to Sell

Honda Motor (NYSE:HMC) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a report released on Wednesday, Zacks.com reports.

According to Zacks, “Honda has been encountering higher operating costs and expenses. Elevated research and development costs can be attributed to this. Also, the company has been recalling vehicles frequently over the past few years. In fact, it is the largest customer of the faulty Takata airbags that can explode and shoot out metal fragments after a vehicle crash. In March 2019, Honda made the announcement to recall around 1 million older vehicles in the United States and Canada for the second time as the Takata airbag inflators that were installed at the time of the previous recalls could turn out to be deadly. However, through the Vision 2030 strategy, the company is focusing on strategies to boost coordination between research and development as well as procurement and manufacturing of products. Also, shares of Honda have outperformed the industry it belongs to in the past year.”

A number of other brokerages have also recently issued reports on HMC. Nomura raised shares of Honda Motor from a “neutral” rating to a “buy” rating in a report on Tuesday, February 19th. ValuEngine cut shares of Honda Motor from a “sell” rating to a “strong sell” rating in a report on Wednesday, February 13th.

Honda Motor stock traded up $0.36 during trading on Wednesday, hitting $28.35. The stock had a trading volume of 8,864 shares, compared to its average volume of 419,334. Honda Motor has a 1 year low of $25.30 and a 1 year high of $35.15. The company has a current ratio of 1.23, a quick ratio of 0.95 and a debt-to-equity ratio of 0.47. The company has a market cap of $49.74 billion, a price-to-earnings ratio of 7.83, a PEG ratio of 5.86 and a beta of 0.94.

Honda Motor (NYSE:HMC) last issued its earnings results on Friday, February 1st. The company reported $0.85 earnings per share (EPS) for the quarter, meeting analysts’ consensus estimates of $0.85. Honda Motor had a net margin of 4.73% and a return on equity of 8.49%. The business had revenue of $3,957.12 billion for the quarter, compared to analysts’ expectations of $3,956.54 billion. During the same quarter in the previous year, the firm posted $318.50 EPS. The business’s revenue for the quarter was down .4% compared to the same quarter last year. As a group, equities research analysts forecast that Honda Motor will post 3.76 earnings per share for the current fiscal year.

A number of hedge funds have recently modified their holdings of the business. Mercer Global Advisors Inc. ADV bought a new stake in Honda Motor during the 1st quarter valued at $1,380,000. Truvestments Capital LLC bought a new stake in Honda Motor during the 1st quarter valued at $31,000. Cardinal Capital Management raised its holdings in Honda Motor by 1.6% during the 1st quarter. Cardinal Capital Management now owns 59,545 shares of the company’s stock valued at $1,617,000 after acquiring an additional 916 shares during the period. Manning & Napier Group LLC raised its holdings in Honda Motor by 4.0% during the 1st quarter. Manning & Napier Group LLC now owns 204,556 shares of the company’s stock valued at $5,557,000 after acquiring an additional 7,775 shares during the period. Finally, American Century Companies Inc. raised its holdings in Honda Motor by 2.2% during the 4th quarter. American Century Companies Inc. now owns 5,306,274 shares of the company’s stock valued at $140,351,000 after acquiring an additional 113,826 shares during the period. 2.07% of the stock is currently owned by institutional investors and hedge funds.

Honda Motor Company Profile

Honda Motor Co, Ltd. develops, manufactures, and distributes motorcycles, automobiles, power products, and other products worldwide. The company operates through four segments: Motorcycle Business, Automobile Business, Financial Services Business, and Power Product and Other Businesses. The Motorcycle Business segment produces sports models, including trial and moto-cross racing vehicles; business and commuter models; all-terrain vehicles; and side-by-side models.

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