Toyota Motor Corporation

Financial Performance

5Y price score: 87

10Y return: 193.6%

DATE RANGE:

JPY Per
Share

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2686.0

52-week range

4000.0

3,070

Your model inputs

Required return / cost of capital

FCFF terminal growth rate

Your fair value & Margin of safety

To calculate fair value based on cost of capital and terminal growth assumptions above, please select free cash flow forecast.

Forecast:

Valuation

Free Cash Flow Yield

(2.2) %

Dividend Yield TTM

3.1 %

Market cap

36,352,031

Price / Earnings TTM

8.7

Price / Book TTM

PEG TTM

0.1

Earnings growth and return

LTM

5YR

10YR

Total return (price & dividends)

7.5 %

79 %

193.6 %

Free cash flow per share growth

(205.7) %

158.5 %

67.7 %

Earnings per share growth

86.9 %

85.8 %

100.8 %

Founded: 1,937

Employees: 383,853

Business Summary:Toyota Motor Corporation designs, manufactures, assembles, and sells passenger vehicles, minivans and commercial vehicles, and related parts and accessories. It operates in Automotive, Financial Services, and All Other segments. The company offers hybrid cars under the Prius name, fuel cell vehicles under the MIRAI name; and conventional engine vehicles, including subcompact and compact cars under the Corolla and Raize names. It also provides mini-vehicles, passenger vehicles, commercial vehicles, and auto parts under the Toyota name; mid-size cars; luxury cars; sports cars under the GR Yaris, Corolla Sport, Corolla Cross, and Supra names; and recreational and sport-utility vehicles under the Highlander name. In addition, the company offers pickup trucks under the Tacoma name; minivans; and trucks and buses. Further, it provides financial services, such as retail financing and leasing, wholesale financing, insurance, and credit cards; and designs, manufactures, and sells prefabricated housing. Additionally, the company operates GAZOO.com, a web portal for automobile information. It operates in Japan, North America, Europe, Asia, Central and South America, Oceania, Africa, and the Middle East. The company was founded in 1933 and is headquartered in Toyota, Japan.

Fair Value Reference Estimate

Latest Earnings Call Takeaways

2026 Q4 (May 8, 2026)

1) Financial Overview and Performance
- Operating income for FY26 was JPY 3.8 trillion, supported by increased vehicle sales and price revisions despite U.S. tariffs impacting profits.
- Consolidated vehicle sales reached 9.6 million units, a 2.5% YoY increase, with Toyota and Lexus sales totaling 10.5 million units.
- Sales revenue was JPY 50.68 trillion, with net income at JPY 3.85 trillion.
- For FY27, operating income is forecasted to decline to JPY 3 trillion, a decrease of JPY 800 billion YoY, largely due to ongoing challenges in the Middle East and rising costs.

2) Market Dynamics and Sales Strategy
- Strong demand in Japan and North America contributed to sales growth, particularly in hybrid vehicles, which exceeded 5 million units sold for the first time.
- The company plans to maintain vehicle sales at 9.6 million units for FY27, with expectations for hybrid sales to exceed 5 million units again.
- The forecast includes a foreign exchange assumption of JPY 150 per dollar and JPY 180 per euro, reflecting a cautious approach to currency fluctuations.

3) Challenges and Headwinds
- U.S. tariffs have had a significant impact, costing JPY 1.38 trillion, which has not been fully absorbed by operational adjustments.
- The company acknowledges limited progress in mid- to long-term structural transformations, which has hindered its ability to respond to rapid changes in the business environment.
- Increased labor costs, material inflation, and geopolitical tensions in the Middle East are expected to continue affecting profitability.

4) Operational Initiatives and Future Plans
- Toyota aims to enhance production efficiency by maximizing existing factory capacities and expanding its model lineup.
- The company is focused on transforming into a mobility company, leveraging technologies in robotics and connected vehicles to drive future growth.
- A commitment to stable dividend increases is maintained, with a planned increase to JPY 100 per share for FY27, despite anticipated profit declines.
- The company is exploring new mobility solutions across various domains, including land, sea, and air, to diversify revenue streams.

5) Guidance and Outlook
- The management emphasizes a commitment to improving operational efficiency and reducing breakeven volumes, with no specific numerical targets set.
- Future investments will focus on R&D, particularly in areas like BEVs, hydrogen technology, and autonomous driving, with R&D expenses reaching a record high of JPY 1.6 trillion.
- The company is actively working to strengthen relationships with suppliers to enhance supply chain resilience and reduce costs amid ongoing inflationary pressures.

Bottom line: Toyota is navigating a challenging environment with a focus on maintaining profitability through operational efficiency and strategic investments in future mobility solutions. While FY27 is expected to see a decline in operating income, the company remains committed to shareholder returns and long-term growth initiatives.

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