On Feb 23, we issued an updated research report on Honda Motor Company HMC.
Honda’s Vision 2030 strategy plan, which aims to boost cooperation between research and development as well as manufacturing, is aiding the company. The plan also aims to reduce developmental costs and focus more on developing electric and self-driving cars. By 2025, it plans to launch autonomous vehicles. In 2022, the company also aims to roll out electric vehicles, capable of getting charged up in 15 minutes, which will eliminate one of the biggest hurdles of the battery-powered cars.
In the last 30 days, the stock has not seen any revision in the Zacks Consensus Estimate for the current quarter, however, the Zacks Consensus Estimate for the current year has moved upward by 31.5% to $4.22 per share.
Honda’s financial position strengthened in fiscal 2017. This continued through the first nine months of fiscal 2018 as well. For fiscal 2018 (ending Mar 31, 2018), Honda expects revenues to improve 8.6% to ¥15.2 trillion. In third-quarter fiscal 2018 (ended Dec 31, 2017) Honda reported better-than-expected earnings as well as revenues.
However, apart from adding to its expenses, frequent vehicle recalls over the past few years were marring customer’s confidence as well. In January 2018, the company reportedly recalled around 465,000 vehicles including Honda and Acura models in the United States.
Shares of Honda have rallied 9.7% in the last three months, outperforming the 9% gain of the industry it belongs to.
Honda carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the auto space are General Motors Company GM, Volkswagen AG VLKAY and AB Volvo VLVLY. Each of these stocks carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
General Motors has an expected long-term growth rate of 8.4%. In the past six months, shares of the company have gained 15.2%.
Volkswagen has an expected long-term growth rate of 18.7%. The shares of the company have risen 30.3% in the past six months.
AB Volvo has an expected long-term growth rate of 15%. In the past six months, shares of the company have rallied 13.7%.
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With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
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