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Research Alert: CFRA Lowers Opinion On Ads Of Toyota Motor Corporation To Sell From Hold

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-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

We lower our 12-month target price to USD150 from USD260, implying a FY 27 (Mar.) P/B of 0.72x, as the latest financial reports and guidance confirm that the structural profit erosion is deeper and more prolonged than we previously anticipated. Our revised FY 27 EPS estimate of JPY2,830, reduced from JPY3,330, reflects the incremental headwind from the Middle East that management has acknowledged it cannot fully absorb on top of the persistent U.S. tariff burden. We initiate a FY 28 EPS forecast of JPY3,210, assuming some degree of stabilization in tariff and geopolitical conditions and a gradual benefit from cost-reduction and value-chain initiatives, but still well short of the levels that would support the previous valuation premium. Our de-rating reflects not only the immediate compression in earnings but also the heightened unpredictability of trade policy and the risk that Toyota's break-even volume remains structurally elevated. We downgrade our rating to Sell from Hold.

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