Hmc

Honda sells 18.82 million motorcycles a year, yet the stock trades at 8.9 times trailing profit.

If you own Honda, you own a cheap global vehicle machine facing an ugly EV reset.

hmc

financials large cap updated feb 6, 2026
$30.00
market cap ~$41B · 52-week range $25–$31
xvary composite: 69 / 100 · average
our overall rating — combines growth, value, risk, and momentum
Start here if you're new
what it is
Honda sells cars, motorcycles, financing, and power equipment across North America, Japan, and Asia.
how it gets paid
Last year Hmc made $142.8B in revenue. Automobile was the main engine at $98.3B, or 68% of sales.
what just happened
Honda's last reported quarter delivered $0.77 EPS versus a $0.25 estimate, a 208.0% surprise.
At a glance
A balance sheet — strong enough to weather a downturn
50/100 earnings predictability — expect surprises
8.9x trailing p/e — the market's not buying it — or you found a deal
5.4% dividend yield — cash in your pocket every quarter
2.5% return on capital — nothing to write home about
xvary composite: 69/100 — average
What they do
Honda sells cars, motorcycles, financing, and power equipment across North America, Japan, and Asia.
You are buying scale, not a story. Honda sold 18.82 million motorcycles and 4.11 million automobiles in fiscal 2023, according to the company description in the research snapshot. Cars are crowded. Motorcycles are a different kind of grip. If your brand moves that many units, your suppliers, dealers, and service network get hard to ignore.
financials large-cap vehicle-maker dividend japan
How they make money
$142.8B annual revenue
Automobile
$98.3B
Financial Services
$23.1B
Motorcycle
$21.7B
Life Creation and Other
$1.4B
The products that matter
manufactures and sells vehicles
automobiles
core business inside $142.8B revenue
the snapshot does not break out auto revenue, but the group's 3.9% net margin tells you the core vehicle business runs in a competitive lane where small pricing changes matter.
thin margins
global two-wheel franchise
motorcycles
largest producer globally
honda is the world's biggest motorcycle producer. that matters because a $41B market cap company with only 2.5% return on capital needs every scale advantage it can get.
brand + scale
supports vehicle purchases
financial services
$55.0B long-term debt
financing helps move product, but it also adds balance-sheet weight: long-term debt is $55.0B, or 57% of capital. that makes funding costs part of the equity story.
funding matters
Key numbers
8.9x
trailing p/e
P/E → stock price divided by last 12 months profit → so what: you are paying $8.90 for each $1 of trailing earnings, versus a market multiple that is usually much higher.
5.4%
dividend yield
Dividend yield → annual cash payout divided by stock price → so what: your cash return is 5.4% a year before any stock move.
45%
north america sales
Regional mix → where revenue is earned → so what: nearly half the business depends on North America, versus 24% in Japan and 23% in Asia.
18.82M
motorcycles sold
Unit sales → how many products customers actually bought → so what: Honda's motorcycle scale is massive next to its 4.11 million auto units.
Financial health
A
strength
  • balance sheet grade A — very strong financial position
  • risk rank 2 — safer than 80% of stocks
  • price stability 80 / 100
  • long-term debt $55.0B (57% of capital)
  • net profit margin 3.9% — keeps 4 cents of every dollar in revenue
  • return on equity 7% — $0.07 profit for every $1 investors have put in
A — balance sheet grade looks solid but long-term debt needs watching.
Total return vs. market

You invested $10,000 in HMC 3 years ago → it's now worth $13,480.

The index would have given you $14,770.

same period. same starting point. HMC trailed the market by $1,290.

source: institutional data · total return
What just happened
beat estimates
Honda's last reported quarter delivered $0.77 EPS versus a $0.25 estimate, a 208.0% surprise.
The clean fact is the beat. Consensus data shows $0.77 actual EPS against $0.25 expected. Recent reporting also says revenue declined vs. prior year, which tells you profit beat and sales strength were not the same thing.
$36B
ttm revenue
$0.77
latest eps
208.0%
eps surprise
the number that mattered
The 208.0% EPS surprise mattered most because it shows expectations were set far too low, even as the broader operating story stayed messy.
source: company earnings report, 2026

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What could go wrong

honda's biggest risk is auto-cycle margin compression in a business that kept only 3.9% of revenue as profit.

!
high
auto-cycle margin compression
a 3.9% net margin means pricing pressure, incentives, or weaker volume can hit earnings fast.
thin margins leave very little room for an ugly demand cycle. if the margin slips from 3.9%, the cheap multiple stops looking generous.
∘
med
debt load and funding costs
long-term debt is $55.0B, or 57% of capital. the balance sheet grade is A, but financing still brings balance-sheet weight.
higher funding costs or tighter credit conditions can eat into the equity story, especially when operating margins are already thin.
∘
med
value-trap economics
8.9x earnings looks cheap until you pair it with 2.5% return on capital and 50/100 earnings predictability.
if returns stay weak, the stock can stay cheap for a long time. low multiples are not a catalyst by themselves.
∘
med
global demand and currency swings
a $142.8B global revenue base gives you scale, but it also exposes you to regional demand moves and foreign-exchange translation noise.
headline revenue can move even when the underlying business changes less than it appears. that can cloud the real trend if you only read the top line.
at 3.9% net margin, 2.5% return on capital, and $55.0B of long-term debt, Honda does not have much room for a bad cycle.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
return on capital is only 2.5%
that is the quiet part loud. if returns do not improve, the 8.9x multiple may be fair, not cheap.
risk
$55.0B of long-term debt is 57% of capital
the balance sheet grade is A, but debt matters more in a 3.9% margin business than it does in a 30% margin one.
trend
institutions have net bought for 3 quarters
200 buyers versus 115 sellers says large holders see value here. you still need the business returns to catch up.
calendar
the next earnings update matters more than the target sheet
this snapshot has no clean fy eps estimate and the long-range targets look noisy. the next hard numbers matter more than spreadsheet optimism.
Analyst rankings
earnings predictability
50 / 100
in human-speak, analysts do not see this as a smooth earnings story.
risk rank
2
safer than roughly 80% of stocks. the balance sheet is doing a lot of work here.
price stability
80 / 100
the shares have been steadier than many cyclical names, which fits the income-stock profile.
source: institutional data
Institutional activity

institutions have been net buying for 3 consecutive quarters — 200 buyers vs. 115 sellers in 3q2025. total institutional holdings: 55.3M shares. net buying for 3 quarters.

source: institutional data · 1q2025-3q2025
source: institutional data
Price targets
3-5 year target range
$18 $37
$30 current price
$28 target midpoint · 7% from current · 3-5yr high: $55 (+85% · 20% ann'l return)
source: institutional data · analyst targets

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