21 Sep

Here’s Why Analysts Continue to Favor Toyota in September

WRITTEN BY John Parker FEATURED IN Wall Street Ratings


In 2017, Toyota Motor’s (TM) global sales volumes were in third place in the world after Renault–Nissan–Mitsubishi Alliance and Volkswagen (VLKAY). Toyota became the world’s largest automaker by volume for the first time in 2008 despite being founded much later than other legacy US auto giants (IYK) General Motors (GM) and Ford Motor Company (F). 

Let’s take a quick look what analysts are recommending for Toyota in September.

Here’s Why Analysts Continue to Favor Toyota in September

Analysts favor Toyota

According to the latest data by Thomson Reuters, ~55% of the total 22 analysts covering Toyota stock have given it “buys.” The remaining 45% have been cautious and have suggested “holds” on the stock, while no analysts have given it “sells.”

About a month ago, 59% of analysts were recommending “buys” on TM. As of September 20, analysts’ 12-month consensus target price for Toyota’s ADR (American depositary receipt) was $138.05. This target price reflected a 10% upside potential from its market price of $124.95 on the NYSE.

Analysts’ consensus target price for TM in August has fallen to $138.05 from $143.18 about two months ago.

Higher US sales than Ford in the third quarter

In August, Toyota reported a 2.0% YoY (year-over-year) fall in its US sales volumes to 223,055 units. Toyota’s August volumes in the US market were higher than Ford’s 218,504 units. This was the second consecutive month during which Toyota reported higher US sales than Ford.

On a YTD (year-to-date) basis, Toyota has sold ~1.62 million units in the US market. These data reflect a 1.0% volume increase from ~1.60 million units sold in the first eight months of 2017.

In the quarter that ended on June 30, TM’s operating margin expanded to 9.3% from 8.1% in the corresponding quarter of the previous year. A positive trend in Toyota’s profit margins could be one of the reasons for analysts’ optimism.

Continue to the next article, where we’ll find out how analysts are rating Honda Motor Company (HMC) in September.

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