Bull of the Day: Toyota (TM) - Bull of the Day
March 07 2014 - 6:23AM
Zacks
Toyota Motor Corporation (TM) has bounced back from the
Great Recession and the Japanese Tsunami. This Zacks Rank #1
(Strong Buy) is expected to post double digit earnings growth in
Fiscal 2014.
Toyota is one of the world's largest auto makers.
It produces cars under the brands Toyota, Lexus, Scion and the
popular Prius. It operates 14 manufacturing plants in North
America.
Luxury and SUVs Still Hot in February
On Mar 3, Toyota announced February North American
car sales which fell 5.8% year over year. But the company saw an up
tick in buying towards the end of the month which it thinks will
set up a strong March.
Additionally, there were pockets of great news
during the month.
The luxury end is still humming along. Lexus saw a
8.7% increase for the month.
"The luxury segment is off to a good start this
year, showing across the board gains," said Jeff Bracken, Lexus
group vice president and general manager.
"The new IS continues to be one of the hottest cars
in any segment, with sales more than doubling for the fourth
straight month." he added.
The SUV segment also continues to be hot. The
all-new RAV4 had sales up 23% for its best February ever.
Similarly, the all-new Highlander sales jumped 30%, also the
best-ever February.
Fiscal 2014 Estimates Rise
The analysts have been bullish on the car companies
for the last several years.
Analysts now expect Toyota to earn $11.96 up from
$7.35 in fiscal 2013.
That's an impressive earnings rise of 62.7%.
Still a Cheap Stock
Toyota is cheap even though shares have surged over
the last 2 years.
![](http://static.zacks.com/images/zacks/blogs/1394143939_scaled_425.jpg)
It has a forward P/E of just 9.5 which is well
under the average of the S&P 500 which is trading at 16x.
With its big earnings growth and low P/E, it has a
PEG ratio of just 0.3. A PEG under 1.0 is rare. It means the
company has the unique combination of both growth and value.
For investors looking for an auto maker with both
growth and value, Toyota is one to keep on the short list.
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Tracey Ryniec is the Value Stock Strategist for Zacks.com.
She is also the Editor of the Insider Trader and Value Investor
services. You can follow her on twitter at @TraceyRyniec.
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