Toyota Motor Watchlist
Toyota Guides for a 22% Profit Drop--Tough to Buy This Dip For Now
264 Views, 12 May 2022 03:26
SC has highlighted this Insight as a Top Pick
- Toyota is famous for conservative guidance, but today's FY3/23 estimates of a 22% decline in pretax profit raised some eyebrows. Raw materials & logistics are to blame.
- Adjusting for various conservative assumptions by Toyota for FY3/23, flat profits are possible, but margin deterioration appears unavoidable.
- On flat profits in FY3/23, the 12x PER & 5.5x EV/EBITDA are not particularly cheap. Toyota is in the "Guidance Dog House" until it can produce a significant beat.