HMC Relative Valuation
HMC's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, HMC is overvalued; if below, it's undervalued.
Historical Valuation
Honda Motor Co Ltd (HMC) is now in the Undervalued zone, suggesting that its current forward PE ratio of 8.19 is considered Undervalued compared with the five-year average of 6.85. The fair price of Honda Motor Co Ltd (HMC) is between 80.42 to 95.16 according to relative valuation methord. Compared to the current price of 29.36 USD , Honda Motor Co Ltd is Undervalued By 63.49%.
Relative Value
Fair Zone
80.42-95.16
Current Price：29.36
63.49%
Undervalued
8.27
PE
1Y
3Y
5Y
Trailing
Forward
9.80
EV/EBITDA
Honda Motor Co Ltd. (HMC) has a current EV/EBITDA of 9.80. The 5-year average EV/EBITDA is 7.45. The thresholds are as follows: Strongly Undervalued below 4.89, Undervalued between 4.89 and 6.17, Fairly Valued between 8.74 and 6.17, Overvalued between 8.74 and 10.02, and Strongly Overvalued above 10.02. The current Forward EV/EBITDA of 9.80 falls within the Overvalued range.
14.66
EV/EBIT
Honda Motor Co Ltd. (HMC) has a current EV/EBIT of 14.66. The 5-year average EV/EBIT is 10.87. The thresholds are as follows: Strongly Undervalued below 6.55, Undervalued between 6.55 and 8.71, Fairly Valued between 13.03 and 8.71, Overvalued between 13.03 and 15.20, and Strongly Overvalued above 15.20. The current Forward EV/EBIT of 14.66 falls within the Overvalued range.
0.27
PS
Honda Motor Co Ltd. (HMC) has a current PS of 0.27. The 5-year average PS is 0.34. The thresholds are as follows: Strongly Undervalued below 0.26, Undervalued between 0.26 and 0.30, Fairly Valued between 0.38 and 0.30, Overvalued between 0.38 and 0.42, and Strongly Overvalued above 0.42. The current Forward PS of 0.27 falls within the Undervalued range.
4.41
P/OCF
Honda Motor Co Ltd. (HMC) has a current P/OCF of 4.41. The 5-year average P/OCF is 5.14. The thresholds are as follows: Strongly Undervalued below 2.38, Undervalued between 2.38 and 3.76, Fairly Valued between 6.52 and 3.76, Overvalued between 6.52 and 7.90, and Strongly Overvalued above 7.90. The current Forward P/OCF of 4.41 falls within the Historic Trend Line -Fairly Valued range.
4.60
P/FCF
Honda Motor Co Ltd. (HMC) has a current P/FCF of 4.60. The 5-year average P/FCF is 13.80. The thresholds are as follows: Strongly Undervalued below -19.86, Undervalued between -19.86 and -3.03, Fairly Valued between 30.63 and -3.03, Overvalued between 30.63 and 47.46, and Strongly Overvalued above 47.46. The current Forward P/FCF of 4.60 falls within the Historic Trend Line -Fairly Valued range.
Honda Motor Co Ltd (HMC) has a current Price-to-Book (P/B) ratio of 1.48. Compared to its 3-year average P/B ratio of 0.73 , the current P/B ratio is approximately 103.51% higher. Relative to its 5-year average P/B ratio of 0.67, the current P/B ratio is about 120.18% higher. Honda Motor Co Ltd (HMC) has a Forward Free Cash Flow (FCF) yield of approximately 1.13%. Compared to its 3-year average FCF yield of 9.41%, the current FCF yield is approximately -87.95% lower. Relative to its 5-year average FCF yield of 13.65% , the current FCF yield is about -91.69% lower.
1.50
P/B
Median3y
0.73
Median5y
0.67
1.14
FCF Yield
Median3y
9.41
Median5y
13.65
Competitors Valuation Multiple
The average P/S ratio for HMC's competitors is 4.13, providing a benchmark for relative valuation. Honda Motor Co Ltd Corp (HMC) exhibits a P/S ratio of 0.27, which is -93.46% above the industry average. Given its robust revenue growth of -0.75%, this premium appears unsustainable.
P/S
P/E
EV/EBITDA
EV/EBIT
P/S
Revenue Growth
Market Cap
Performance Decomposition
1Y
3Y
5Y
Market capitalization of HMC increased by 3.89% over the past 1 year. The primary factor behind the change was an increase in Margin Expansion from 2.09 to 2.53.
The secondary factor is the Revenue Growth, contributed -0.75%to the performance.
Overall, the performance of HMC in the past 1 year is driven by Margin Expansion. Which is more sustainable.
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FAQ
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