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Honda Motor (HMC) Dips More Than Broader Markets: What You Should Know

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Honda Motor (HMC) closed the most recent trading day at $29.19, moving -1.25% from the previous trading session. This change lagged the S&P 500's 0.51% loss on the day.

Coming into today, shares of the automaker had lost 5.26% in the past month. In that same time, the Auto-Tires-Trucks sector gained 10.7%, while the S&P 500 gained 3.08%.

Wall Street will be looking for positivity from HMC as it approaches its next earnings report date. This is expected to be November 5, 2021. On that day, HMC is projected to report earnings of $0.74 per share, which would represent a year-over-year decline of 43.51%. Our most recent consensus estimate is calling for quarterly revenue of $31.19 billion, down 9.36% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.43 per share and revenue of $132.63 billion, which would represent changes of -4.46% and +6.56%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for HMC. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 12.27% lower. HMC currently has a Zacks Rank of #5 (Strong Sell).

Looking at its valuation, HMC is holding a Forward P/E ratio of 8.61. Its industry sports an average Forward P/E of 10.03, so we one might conclude that HMC is trading at a discount comparatively.

Meanwhile, HMC's PEG ratio is currently 0.57. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. HMC's industry had an average PEG ratio of 0.35 as of yesterday's close.

The Automotive - Foreign industry is part of the Auto-Tires-Trucks sector. This industry currently has a Zacks Industry Rank of 206, which puts it in the bottom 19% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow HMC in the coming trading sessions, be sure to utilize Zacks.com.


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