Intrinsic value of Honda Motor ADR - HMC

Previous Close

$28.22

  Intrinsic Value

$328.53

stock screener

  Rating & Target

str. buy

+999%

Previous close

$28.22

 
Intrinsic value

$328.53

 
Up/down potential

+999%

 
Rating

str. buy

We calculate the intrinsic value of HMC stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 1.6

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  6.30
  6.17
  6.05
  5.95
  5.85
  5.77
  5.69
  5.62
  5.56
  5.50
  5.45
  5.41
  5.37
  5.33
  5.30
  5.27
  5.24
  5.22
  5.20
  5.18
  5.16
  5.14
  5.13
  5.12
  5.10
  5.09
  5.08
  5.08
  5.07
  5.06
Revenue, $m
  142,830
  151,643
  160,822
  170,387
  180,359
  190,762
  201,618
  212,952
  224,792
  237,163
  250,097
  263,622
  277,771
  292,577
  308,076
  324,304
  341,301
  359,106
  377,762
  397,313
  417,807
  439,292
  461,819
  485,442
  510,217
  536,204
  563,465
  592,064
  622,070
  653,554
Variable operating expenses, $m
  134,219
  142,461
  151,045
  159,990
  169,316
  179,044
  189,196
  199,796
  210,868
  222,437
  233,884
  246,532
  259,764
  273,610
  288,104
  303,281
  319,175
  335,826
  353,273
  371,557
  390,722
  410,814
  431,880
  453,972
  477,141
  501,444
  526,937
  553,682
  581,743
  611,186
Fixed operating expenses, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  134,219
  142,461
  151,045
  159,990
  169,316
  179,044
  189,196
  199,796
  210,868
  222,437
  233,884
  246,532
  259,764
  273,610
  288,104
  303,281
  319,175
  335,826
  353,273
  371,557
  390,722
  410,814
  431,880
  453,972
  477,141
  501,444
  526,937
  553,682
  581,743
  611,186
Operating income, $m
  8,611
  9,182
  9,777
  10,397
  11,044
  11,718
  12,422
  13,156
  13,924
  14,726
  16,213
  17,090
  18,007
  18,967
  19,972
  21,024
  22,126
  23,280
  24,489
  25,757
  27,085
  28,478
  29,938
  31,470
  33,076
  34,761
  36,528
  38,382
  40,327
  42,368
EBITDA, $m
  15,561
  16,521
  17,522
  18,564
  19,650
  20,784
  21,966
  23,201
  24,491
  25,839
  27,248
  28,722
  30,263
  31,876
  33,565
  35,333
  37,185
  39,125
  41,157
  43,287
  45,520
  47,861
  50,315
  52,889
  55,588
  58,419
  61,389
  64,505
  67,775
  71,205
Interest expense (income), $m
  867
  3,294
  3,633
  3,987
  4,355
  4,739
  5,139
  5,557
  5,992
  6,447
  6,922
  7,419
  7,938
  8,480
  9,048
  9,642
  10,264
  10,915
  11,597
  12,312
  13,060
  13,845
  14,667
  15,529
  16,433
  17,381
  18,375
  19,418
  20,512
  21,659
  22,863
Earnings before tax, $m
  5,316
  5,549
  5,790
  6,042
  6,304
  6,579
  6,865
  7,164
  7,477
  7,804
  8,794
  9,152
  9,527
  9,919
  10,330
  10,760
  11,210
  11,683
  12,178
  12,696
  13,240
  13,811
  14,409
  15,037
  15,695
  16,385
  17,110
  17,870
  18,668
  19,505
Tax expense, $m
  1,435
  1,498
  1,563
  1,631
  1,702
  1,776
  1,854
  1,934
  2,019
  2,107
  2,374
  2,471
  2,572
  2,678
  2,789
  2,905
  3,027
  3,154
  3,288
  3,428
  3,575
  3,729
  3,890
  4,060
  4,238
  4,424
  4,620
  4,825
  5,040
  5,266
Net income, $m
  3,881
  4,050
  4,227
  4,410
  4,602
  4,802
  5,011
  5,230
  5,458
  5,697
  6,420
  6,681
  6,955
  7,241
  7,541
  7,855
  8,184
  8,528
  8,890
  9,268
  9,666
  10,082
  10,519
  10,977
  11,457
  11,961
  12,490
  13,045
  13,627
  14,238

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  179,887
  190,986
  202,546
  214,593
  227,153
  240,254
  253,927
  268,202
  283,113
  298,694
  314,983
  332,017
  349,837
  368,485
  388,005
  408,444
  429,850
  452,274
  475,771
  500,395
  526,205
  553,264
  581,636
  611,388
  642,591
  675,320
  709,653
  745,673
  783,463
  823,116
Adjusted assets (=assets-cash), $m
  179,887
  190,986
  202,546
  214,593
  227,153
  240,254
  253,927
  268,202
  283,113
  298,694
  314,983
  332,017
  349,837
  368,485
  388,005
  408,444
  429,850
  452,274
  475,771
  500,395
  526,205
  553,264
  581,636
  611,388
  642,591
  675,320
  709,653
  745,673
  783,463
  823,116
Revenue / Adjusted assets
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
  0.794
Average production assets, $m
  71,843
  76,276
  80,893
  85,705
  90,721
  95,953
  101,414
  107,115
  113,070
  119,293
  125,799
  132,602
  139,719
  147,166
  154,962
  163,125
  171,674
  180,630
  190,014
  199,849
  210,157
  220,964
  232,295
  244,177
  256,639
  269,711
  283,423
  297,808
  312,901
  328,738
Working capital, $m
  17,282
  18,349
  19,459
  20,617
  21,823
  23,082
  24,396
  25,767
  27,200
  28,697
  30,262
  31,898
  33,610
  35,402
  37,277
  39,241
  41,297
  43,452
  45,709
  48,075
  50,555
  53,154
  55,880
  58,738
  61,736
  64,881
  68,179
  71,640
  75,270
  79,080
Total debt, $m
  67,286
  73,834
  80,655
  87,762
  95,173
  102,902
  110,969
  119,392
  128,189
  137,382
  146,993
  157,043
  167,556
  178,559
  190,076
  202,134
  214,764
  227,994
  241,857
  256,385
  271,614
  287,578
  304,317
  321,871
  340,281
  359,591
  379,848
  401,099
  423,396
  446,791
Total liabilities, $m
  106,133
  112,682
  119,502
  126,610
  134,020
  141,750
  149,817
  158,239
  167,037
  176,230
  185,840
  195,890
  206,404
  217,406
  228,923
  240,982
  253,612
  266,842
  280,705
  295,233
  310,461
  326,426
  343,165
  360,719
  379,129
  398,439
  418,695
  439,947
  462,243
  485,639
Total equity, $m
  73,754
  78,304
  83,044
  87,983
  93,133
  98,504
  104,110
  109,963
  116,076
  122,465
  129,143
  136,127
  143,433
  151,079
  159,082
  167,462
  176,239
  185,433
  195,066
  205,162
  215,744
  226,838
  238,471
  250,669
  263,462
  276,881
  290,958
  305,726
  321,220
  337,478
Total liabilities and equity, $m
  179,887
  190,986
  202,546
  214,593
  227,153
  240,254
  253,927
  268,202
  283,113
  298,695
  314,983
  332,017
  349,837
  368,485
  388,005
  408,444
  429,851
  452,275
  475,771
  500,395
  526,205
  553,264
  581,636
  611,388
  642,591
  675,320
  709,653
  745,673
  783,463
  823,117
Debt-to-equity ratio
  0.910
  0.940
  0.970
  1.000
  1.020
  1.040
  1.070
  1.090
  1.100
  1.120
  1.140
  1.150
  1.170
  1.180
  1.190
  1.210
  1.220
  1.230
  1.240
  1.250
  1.260
  1.270
  1.280
  1.280
  1.290
  1.300
  1.310
  1.310
  1.320
  1.320
Adjusted equity ratio
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  3,881
  4,050
  4,227
  4,410
  4,602
  4,802
  5,011
  5,230
  5,458
  5,697
  6,420
  6,681
  6,955
  7,241
  7,541
  7,855
  8,184
  8,528
  8,890
  9,268
  9,666
  10,082
  10,519
  10,977
  11,457
  11,961
  12,490
  13,045
  13,627
  14,238
Depreciation, amort., depletion, $m
  6,951
  7,340
  7,745
  8,167
  8,607
  9,066
  9,545
  10,045
  10,567
  11,113
  11,035
  11,632
  12,256
  12,909
  13,593
  14,309
  15,059
  15,845
  16,668
  17,531
  18,435
  19,383
  20,377
  21,419
  22,512
  23,659
  24,862
  26,124
  27,447
  28,837
Funds from operations, $m
  10,832
  11,390
  11,971
  12,577
  13,209
  13,868
  14,556
  15,274
  16,025
  16,810
  17,455
  18,313
  19,211
  20,150
  21,134
  22,164
  23,243
  24,373
  25,558
  26,799
  28,100
  29,465
  30,895
  32,396
  33,970
  35,620
  37,352
  39,169
  41,075
  43,075
Change in working capital, $m
  1,024
  1,066
  1,111
  1,157
  1,207
  1,259
  1,314
  1,371
  1,433
  1,497
  1,565
  1,637
  1,712
  1,792
  1,875
  1,964
  2,057
  2,154
  2,257
  2,366
  2,480
  2,600
  2,726
  2,858
  2,998
  3,144
  3,299
  3,461
  3,631
  3,810
Cash from operations, $m
  9,807
  10,324
  10,861
  11,420
  12,002
  12,609
  13,242
  13,903
  14,593
  15,313
  15,890
  16,676
  17,499
  18,359
  19,258
  20,200
  21,186
  22,219
  23,300
  24,433
  25,621
  26,865
  28,170
  29,537
  30,972
  32,476
  34,053
  35,708
  37,444
  39,265
Maintenance CAPEX, $m
  -5,931
  -6,302
  -6,691
  -7,096
  -7,518
  -7,958
  -8,417
  -8,896
  -9,396
  -9,918
  -10,464
  -11,035
  -11,632
  -12,256
  -12,909
  -13,593
  -14,309
  -15,059
  -15,845
  -16,668
  -17,531
  -18,435
  -19,383
  -20,377
  -21,419
  -22,512
  -23,659
  -24,862
  -26,124
  -27,447
New CAPEX, $m
  -4,226
  -4,433
  -4,617
  -4,811
  -5,016
  -5,232
  -5,461
  -5,701
  -5,955
  -6,223
  -6,505
  -6,803
  -7,117
  -7,448
  -7,796
  -8,163
  -8,549
  -8,956
  -9,384
  -9,834
  -10,308
  -10,807
  -11,331
  -11,882
  -12,462
  -13,071
  -13,712
  -14,385
  -15,093
  -15,837
Cash from investing activities, $m
  -10,157
  -10,735
  -11,308
  -11,907
  -12,534
  -13,190
  -13,878
  -14,597
  -15,351
  -16,141
  -16,969
  -17,838
  -18,749
  -19,704
  -20,705
  -21,756
  -22,858
  -24,015
  -25,229
  -26,502
  -27,839
  -29,242
  -30,714
  -32,259
  -33,881
  -35,583
  -37,371
  -39,247
  -41,217
  -43,284
Free cash flow, $m
  -350
  -411
  -447
  -488
  -532
  -581
  -635
  -694
  -759
  -829
  -1,080
  -1,162
  -1,250
  -1,345
  -1,447
  -1,556
  -1,672
  -1,796
  -1,929
  -2,069
  -2,218
  -2,376
  -2,544
  -2,722
  -2,909
  -3,108
  -3,318
  -3,539
  -3,772
  -4,019
Issuance/(repayment) of debt, $m
  6,280
  6,548
  6,821
  7,108
  7,410
  7,730
  8,067
  8,422
  8,797
  9,193
  9,610
  10,050
  10,514
  11,002
  11,517
  12,059
  12,630
  13,230
  13,863
  14,528
  15,228
  15,965
  16,739
  17,554
  18,410
  19,310
  20,257
  21,251
  22,297
  23,395
Issuance/(repurchase) of shares, $m
  477
  500
  513
  529
  547
  569
  594
  623
  655
  692
  258
  303
  352
  405
  463
  525
  593
  666
  744
  827
  917
  1,012
  1,114
  1,222
  1,336
  1,458
  1,586
  1,723
  1,867
  2,019
Cash from financing (excl. dividends), $m  
  6,757
  7,048
  7,334
  7,637
  7,957
  8,299
  8,661
  9,045
  9,452
  9,885
  9,868
  10,353
  10,866
  11,407
  11,980
  12,584
  13,223
  13,896
  14,607
  15,355
  16,145
  16,977
  17,853
  18,776
  19,746
  20,768
  21,843
  22,974
  24,164
  25,414
Total cash flow (excl. dividends), $m
  6,407
  6,637
  6,886
  7,149
  7,426
  7,718
  8,026
  8,351
  8,694
  9,056
  8,789
  9,191
  9,615
  10,062
  10,533
  11,028
  11,550
  12,100
  12,678
  13,287
  13,927
  14,600
  15,309
  16,053
  16,837
  17,660
  18,525
  19,435
  20,391
  21,396
Retained Cash Flow (-), $m
  -4,358
  -4,551
  -4,740
  -4,939
  -5,150
  -5,372
  -5,606
  -5,853
  -6,114
  -6,388
  -6,678
  -6,984
  -7,306
  -7,646
  -8,003
  -8,380
  -8,777
  -9,194
  -9,633
  -10,096
  -10,582
  -11,094
  -11,632
  -12,198
  -12,793
  -13,419
  -14,077
  -14,768
  -15,494
  -16,258
Prev. year cash balance distribution, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  2,049
  2,087
  2,147
  2,210
  2,276
  2,346
  2,420
  2,498
  2,581
  2,668
  2,111
  2,207
  2,309
  2,416
  2,529
  2,648
  2,774
  2,906
  3,045
  3,191
  3,344
  3,506
  3,676
  3,855
  4,043
  4,241
  4,449
  4,667
  4,897
  5,138
Discount rate, %
  6.10
  6.41
  6.73
  7.06
  7.41
  7.79
  8.17
  8.58
  9.01
  9.46
  9.94
  10.43
  10.95
  11.50
  12.08
  12.68
  13.32
  13.98
  14.68
  15.41
  16.19
  16.99
  17.84
  18.74
  19.67
  20.66
  21.69
  22.77
  23.91
  25.11
PV of cash for distribution, $m
  1,931
  1,843
  1,766
  1,682
  1,592
  1,496
  1,396
  1,293
  1,187
  1,080
  744
  671
  598
  526
  457
  392
  331
  276
  226
  181
  143
  111
  84
  63
  45
  32
  22
  15
  10
  6
Current shareholders' claim on cash, %
  99.0
  98.1
  97.2
  96.3
  95.4
  94.6
  93.8
  93.0
  92.2
  91.4
  91.2
  90.9
  90.5
  90.2
  89.8
  89.4
  88.9
  88.4
  87.9
  87.4
  86.8
  86.3
  85.7
  85.0
  84.4
  83.7
  83.1
  82.4
  81.6
  80.9

Honda Motor Co., Ltd. (Honda) develops, manufactures and markets motorcycles, automobiles and power products across the world. The Company's segments include Motorcycle Business, Automobile business, Financial services business, and Power product and other businesses. The Company produces a range of motorcycles, with engine displacement ranging from the 50 cubic centimeters class to the 1,800 cubic centimeters class. Its automobiles use gasoline engines of three, four or six cylinder, diesel engines, gasoline-electric hybrid systems and gasoline-electric plug-in hybrid systems. Honda offers a range of financial services to its customers and dealers through finance subsidiaries in countries, including Japan, the United States, Canada, the United Kingdom, Germany, Brazil and Thailand. Honda manufactures a range of power products, including general-purpose engines, generators, water pumps, lawn mowers, riding mowers, grass cutters, brush cutters, tillers and snow blowers.

FINANCIAL RATIOS  of  Honda Motor ADR (HMC)

Valuation Ratios
P/E Ratio 9.5
Price to Sales 0.4
Price to Book 0.8
Price to Tangible Book
Price to Cash Flow 6.6
Price to Free Cash Flow 23.6
Growth Rates
Sales Growth Rate -4.1%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -26.9%
Cap. Spend. - 3 Yr. Gr. Rate -7.2%
Financial Strength
Quick Ratio 1
Current Ratio 0.1
LT Debt to Equity 55.8%
Total Debt to Equity 95.6%
Interest Coverage 11
Management Effectiveness
Return On Assets 3.7%
Ret/ On Assets - 3 Yr. Avg. 3.1%
Return On Total Capital 4.5%
Ret/ On T. Cap. - 3 Yr. Avg. 3.6%
Return On Equity 8.8%
Return On Equity - 3 Yr. Avg. 7.1%
Asset Turnover 0.8
Profitability Ratios
Gross Margin 22.4%
Gross Margin - 3 Yr. Avg. 22.4%
EBITDA Margin 12.7%
EBITDA Margin - 3 Yr. Avg. 11.2%
Operating Margin 6%
Oper. Margin - 3 Yr. Avg. 4.8%
Pre-Tax Margin 7.2%
Pre-Tax Margin - 3 Yr. Avg. 5.9%
Net Profit Margin 4.4%
Net Profit Margin - 3 Yr. Avg. 3.5%
Effective Tax Rate 32.5%
Eff/ Tax Rate - 3 Yr. Avg. 33%
Payout Ratio 26.3%

HMC stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the HMC stock intrinsic value calculation we used $134365.01522 million for the last fiscal year's total revenue generated by Honda Motor ADR. The default revenue input number comes from 0001 income statement of Honda Motor ADR. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our HMC stock valuation model: a) initial revenue growth rate of 6.3% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 6.1%, whose default value for HMC is calculated based on our internal credit rating of Honda Motor ADR, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Honda Motor ADR.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of HMC stock the variable cost ratio is equal to 94%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for HMC stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Honda Motor ADR.

Corporate tax rate of 27% is the nominal tax rate for Honda Motor ADR. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the HMC stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for HMC are equal to 50.3%.

Life of production assets of 11.4 years is the average useful life of capital assets used in Honda Motor ADR operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for HMC is equal to 12.1%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $69395.2101046 million for Honda Motor ADR - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 57.853 million for Honda Motor ADR is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Honda Motor ADR at the current share price and the inputted number of shares is $1.6 billion.

RELATED COMPANIES Price Int.Val. Rating
TM Toyota Motor A 117.00 9,769.42  str.buy
F Ford Motor 9.31 14.28  buy
TSLA Tesla 348.44 83.24  str.sell

COMPANY NEWS

▶ 5 things every driver should keep in their car   [Nov-16-18 09:31AM  Yahoo Finance]
▶ Auto ETF in Focus Post Quarterly Results   [Nov-14-18 04:41PM  Zacks]
▶ GM Stock Is a Mixed Bag   [01:47PM  InvestorPlace]
▶ Automakers Surge Past Street's October Benchmarks   [Nov-02-18 11:26AM  Benzinga]
▶ Survival tips for your car this winter   [04:02PM  Yahoo Finance]
▶ October a strong month for auto sales   [12:59PM  CNBC Videos]
▶ Honda sales still down year-over-year, but not by much   [11:25AM  American City Business Journals]
▶ Automotive Minute: 2019 Acura ILX looks better, has a lower price (Photos)   [Oct-30-18 01:46PM  American City Business Journals]
▶ Honda: Fiscal 2Q Earnings Snapshot   [05:05AM  Associated Press]
▶ Hell Freezes Over: Citron Research Gives Tesla A Bro Hug, Reverses View   [Oct-23-18 04:28PM  Investor's Business Daily]
▶ Why Alphabet's Waymo Can Prove the Naysayers Wrong   [Oct-20-18 02:00PM  Motley Fool]
▶ Car Companies Look to Each Other, Silicon Valley for Self-Driving Ventures   [Oct-17-18 07:40PM  The Wall Street Journal]
▶ Sharing More Than Just Rides in Car-Maker Alliances   [05:30AM  The Wall Street Journal]
▶ Honda airbags are being stolen   [Oct-15-18 01:42PM  Autoblog]
▶ 7 Consumer Stocks to Sell Now   [06:00AM  InvestorPlace]
▶ Deals of the day-Mergers and acquisitions   [Oct-04-18 04:00PM  Reuters]
▶ A Tencent IPO Investors Wont Want to Miss   [03:05PM  Motley Fool]
▶ Company News For Oct 4, 2018   [10:16AM  Zacks]
▶ Market Morning: Biggest Bond Blowup Since 1991   [07:00AM  Market Exclusive]

CONTACT US       ASSET ALLOCATION

About X-FIN       Site news       Privacy policy       Terms of use       FAQ

Copyright © X-FIN.com 2005-2018. All rigths reserved.