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Here's Why Honda Motor (HMC) is a Strong Value Stock

Zacks Equity Research
·2-min read

For new and old investors, taking full advantage of the stock market and investing with confidence are common goals.

While you may have an investing style you rely on, finding great stocks is made easier with the Zacks Style Scores. These are complementary indicators that rate stocks based on value, growth, and/or momentum characteristics.

Why Investors Should Pay Attention to This Value Stock

Different than growth or momentum investors, value-focused investors are all about finding good stocks at good prices, and discovering which companies are trading under what their true value is before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to help pick out the most attractive and discounted stocks.

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Honda Motor (HMC)

Honda Motor Co., Ltd. is a leading manufacturer of automobiles and the largest producer of motorcycles in the world. The company is recognized internationally for its wide variety of products, ranging from small general-purpose engines to specialty sports cars, which incorporate its efficient internal combustion engine technologies.

HMC sits at a Zacks Rank #1 (Strong Buy), holds a Value Style Score of A, and has a VGM Score of B. Compared to the Automotive - Foreign industry's P/E of 6.3X, shares of Honda Motor are trading at a forward P/E of 8.1X. HMC also has a PEG Ratio of 0.4, a Price/Cash Flow ratio of 5.5X, and a Price/Sales ratio of 0.4X.

Value investors don't just pay attention to a company's valuation ratios; positive earnings play a crucial role, too. Two analysts revised their earnings estimate upwards in the last 60 days for fiscal 2024. The Zacks Consensus Estimate has increased $0.16 to $4.16 per share. HMC has an average earnings surprise of 26.9%.

HMC should be on investors' short lists because of its impressive earnings and valuation fundamentals, a good Zacks Rank, and strong Value and VGM Style Scores.

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Honda Motor Co., Ltd. (HMC) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research