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Toyota Motor Corp 7203

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Morningstar’s Analysis

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A Weaker Yen and Likely Higher Pricing Help Toyota's Fiscal Q2 Despite the Chip Shortage

Analyst Note

| David Whiston, CFA, CPA, CFE |

Toyota reported what we see as solid second-quarter and first-half fiscal 2022 results despite the chip shortage. Due to an increase in full-year fiscal 2022 guidance and a forecast for a weaker yen against the dollar, we are raising our dollar and yen per share fair value estimates by about 3% and 5%, respectively, to $179 and JPY 2,000. We expect the shortage to improve for Toyota during the second half of fiscal 2022 but remain an issue for the auto industry into the firm’s fiscal 2023. Toyota will also be battling higher steel costs like its competitors.

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Company Profile

Business Description

Founded in 1937, Toyota is one of the world's largest automakers with 9.92 million units sold at retail in fiscal 2021 across its light vehicle brands. Brands include Toyota, Lexus, Daihatsu, and truck maker Hino; market share in Japan is about 52%, while U.S. share is over 15%. The firm also owns large stake in Denso, a parts supplier, at least 16% of Subaru (with a deal to raise that to 20%), and holds investments in many other firms, including shares of Uber Technologies and about 5% in each of Mazda and Suzuki. Fiscal 2021 sales excluding financial services were JPY 25.1 trillion. Toyota also has a financing arm and manufactures homes and boats.

1 Toyota-cho, Aichi Prefecture
Toyota, 471-8571, Japan
T +81 565282121
Sector Consumer Cyclical
Industry Auto Manufacturers
Most Recent Earnings Sep 30, 2021
Fiscal Year End Mar 31, 2022
Stock Type
Employees 366,283