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Honda (HMC) Reports Y/Y Improvement in Q1 Profit and Revenues

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Honda (HMC) Reports Y/Y Improvement in Q1 Profit and Revenues

Honda's (HMC) Q1 performance gains on higher revenues in all business operations.

Honda Motor Co., Ltd. HMC reported a consolidated profit of ¥244.3 billion in the first quarter of fiscal 2019, up 17.8% from the year-ago period.

Revenues increased 8.4% year over year to ¥4 trillion. The year-over-year increase can be attributed to higher revenues in all business operations.

Consolidated operating profit was ¥299.3 billion, reflecting an increase of 11.2% from the prior-year quarter. This improvement can be attributable to a rise in profit related to changes in sales volume and model mix, and a fall in selling, general and administrative (SG&A) expenses.

Honda Motor Co., Ltd. Price, Consensus and EPS Surprise

 

Honda Motor Co., Ltd. Price, Consensus and EPS Surprise | Honda Motor Co., Ltd. Quote

Segmental Performance

For the three months ended Jun 30, 2018, revenues from the Automobile segment’s sales increased 8% to ¥2.8 trillion. During the reported quarter, unit sales increased 3% year over year to 1.31 million. The Motorcycle segment increased 9.1% to ¥554.9 billion and unit sales increased 13.9% on a year-over-year basis to 5.35 million.

In the quarter ended Jun 30, 2018, the Financial Services segment increased 9.9% to ¥590 billion. The Power Product & Other segment was up 5.6% to ¥82 billion and unit sales increased 0.8% on a year-over-year basis to 1.34 million vehicles.

Financial Position

Consolidated cash and cash equivalents were ¥2.17 trillion as of Jun 30, 2018, up from ¥2.02 trillion as of Jun 30, 2017.

Guidance

For fiscal 2019 (ending Mar 31, 2019), Honda expects revenues to be down ¥150 billion to ¥15.5 trillion. Operating income is likely to increase by ¥10 billion to ¥710 billion.

Zacks Rank & Key Picks

Honda currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the auto space are Oshkosh Corporation OSK, AB Volvo VLVLY and Fox Factory Holding Corp. FOXF, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Oshkosh has an expected long-term growth rate of 18.3%. Over the past year, shares of the company have moved up 6.7%.

AB Volvo has an expected long-term growth rate of 15%. Over the past year, shares of the company have gained 4%.

Fox Factory has an expected long-term growth rate of 15.8%. Shares of the company have risen 27.6% over the past year.

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