Toyota Motor (TM) is a well-known name in the global auto industry. Despite being founded much later than mainstream US automakers (IYK) such as General Motors (GM) and Ford (F), Toyota became the world’s largest automaker by volume in 2008. Toyota’s 2016 US sales were also higher than Fiat Chrysler’s (FCAU) US sales.
According to the latest data compiled by Reuters, out of the 24 analysts covering Toyota, 50.0% gave the stock a “buy” recommendation, 42% gave a “hold” recommendation, and 8% gave a “sell” recommendation.
As of March 16, 2017, Toyota’s consensus 12-month target price was $119.99 on the NYSE. It reflects an upside potential of ~6% from its market price of $113.24.
Last year, Toyota underperformed the broader market and delivered a negative return of ~4.7%. Investors’ concerns about a possible slowdown in overall US auto sales and lower car sales could be the primary reasons for Toyota’s negative performance on Wall Street. So far in 2017, it has lost ~3.4% on Wall Street as of March 16, unlike its peers.
In 2016, Toyota Motor sold ~2.4 million vehicle units in the US market—a fall of 2.0% from 2.5 million units in 2015. The company sells its vehicles in the US market under two key brands—Toyota and Lexus.
Note that Japanese automakers Toyota and Honda rule the car segment in the US auto market. Toyota’s Camry and Corolla models were the two best-selling car models in the US in 2016. Therefore, a continued fall in US car sales could hurt Japanese automakers including Toyota.