Analyst Note| David Whiston, CFA, CPA, CFE |
Honda’s fiscal 2022 second quarter showed more semiconductor shortage problems than rival Toyota. We are leaving our U.S. dollar fair value estimate in place and raising our yen fair value estimate to JPY 4,100 from JPY 4,000 on the time value of money and a weaker yen forecast over our five-year explicit forecast period. A weaker yen spot rate against the dollar negates these benefits when our yen fair value estimate is translated into dollars. We now translate the yen fair value at JPY 113.46 to the dollar instead of JPY 109.46.