Toyota Motor (7203) AI Stock Analysis

• Market Cap: ¥38.23T
• Dividend Yield: 2.91%
• Average Volume (3M): 21.69M
• Price to Earnings (P/E): 9.0
• Beta (1Y): 1.53
• Revenue Growth: 4.45%
• EPS Growth: -11.43%
• Country: JP
• Employees: 383,853
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Manufacturers
• EPS (TTM): 64.56
• Shares Outstanding: 15,794,987,000
• 10 Day Avg. Volume: 23,861,439
• 30 Day Avg. Volume: 21,690,069
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ¥3,350.00
• Price Target Upside: 7.13% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 81 Outperform
• Price Target: ¥3,468.00 ▲(10.91% Upside)

Toyota Motor's stock is rated highly due to its strong valuation metrics and positive technical indicators. The company's robust revenue growth and profitability further support its position, though challenges in cash flow management and rising debt levels should be monitored. Overall, the stock presents a compelling investment opportunity in the auto manufacturing industry.

Positive Factors

Revenue Growth

Toyota's robust revenue growth indicates strong market demand and effective sales strategies, supporting long-term business expansion and competitiveness.

Profitability Margins

Sustained profitability margins reflect efficient cost management and operational efficiency, ensuring financial stability and shareholder value.

Tariff Easing

Easing tariffs will reduce costs for imported parts, enhancing Toyota's profitability and competitive edge in the U.S. market.

Negative Factors

Rising Debt Levels

Rising debt levels can strain financial resources and limit flexibility, potentially impacting Toyota's ability to invest in growth opportunities.

Cash Flow Management

Poor cash flow management may hinder Toyota's capacity to fund operations and investments, affecting long-term financial health.

Rare Earth Supply Risks

Dependence on rare earths poses supply chain risks, potentially disrupting production and increasing costs, affecting Toyota's operational stability.

Toyota Motor Business Overview & Revenue Model

Company Description

Toyota Motor Corporation designs, manufactures, assembles, and sells passenger vehicles, minivans and commercial vehicles, and related parts and accessories. It operates in Automotive, Financial Services, and All Other segments. The company offers hybrid cars under the Prius name, fuel cell vehicles under the MIRAI name; and conventional engine vehicles, including subcompact and compact cars under the Corolla and Raize names. It also provides mini-vehicles, passenger vehicles, commercial vehicles, and auto parts under the Toyota name; mid-size cars; luxury cars; sports cars under the GR Yaris, Corolla Sport, Corolla Cross, and Supra names; and recreational and sport-utility vehicles under the Highlander name. In addition, the company offers pickup trucks under the Tacoma name; minivans; and trucks and buses. Further, it provides financial services, such as retail financing and leasing, wholesale financing, insurance, and credit cards; and designs, manufactures, and sells prefabricated housing. Additionally, the company operates GAZOO.com, a web portal for automobile information. It operates in Japan, North America, Europe, Asia, Central and South America, Oceania, Africa, and the Middle East. The company was founded in 1933 and is headquartered in Toyota, Japan.

How the Company Makes Money

Toyota generates revenue primarily through the sale of vehicles, which includes passenger cars, trucks, and SUVs. The company also earns significant income from its financial services division, which provides financing solutions for customers and dealerships, including loans and leasing options. Additionally, Toyota has a growing revenue stream from its investment in hybrid and electric vehicle technology, as well as from partnerships in research and development for sustainable transportation solutions. Key partnerships with technology firms and collaborations in various markets further enhance its earning potential, while its strong brand reputation contributes to consistent sales across global markets.

Toyota Motor Financial Statement Overview

Summary

Toyota Motor demonstrates strong revenue growth and profitability, supported by efficient operational management. The balance sheet is stable with a balanced capital structure, though rising debt levels warrant attention. Cash flow management presents challenges, particularly in converting earnings into free cash flow, which could impact future financial flexibility.

Income Statement

Toyota Motor shows strong financial performance with a consistent revenue growth trend, highlighted by a TTM revenue growth rate of 86.5%. The company maintains healthy profitability margins, with a gross profit margin of 19.94% and a net profit margin of 9.92% in the TTM period. The EBIT and EBITDA margins are also robust at 12.52% and 17.21%, respectively, indicating efficient operational management. However, there is a slight decline in gross profit and net income compared to the previous annual report, which should be monitored.

Balance Sheet

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 1.08, which is manageable for the industry. The return on equity is strong at 13.43%, indicating effective use of shareholder funds. The equity ratio stands at 38.54%, suggesting a balanced capital structure. However, the increase in total debt over the periods could pose a risk if not managed carefully.

Cash Flow

Toyota's cash flow statement reveals challenges in free cash flow management, with a significant negative growth rate of -113.92% in the TTM period. The operating cash flow to net income ratio is 0.13, which is relatively low, indicating potential cash flow constraints. The free cash flow to net income ratio is negative, reflecting issues in converting profits into free cash flow. These factors suggest a need for improved cash flow management.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	48.45T	48.04T	45.10T	37.15T	31.38T	27.21T
Gross Profit	9.35T	9.58T	9.37T	6.31T	5.97T	4.83T
EBITDA	7.78T	8.27T	8.39T	5.19T	5.30T	4.27T
Net Income	4.27T	4.77T	4.94T	2.45T	2.85T	2.25T
Balance Sheet
Total Assets	93.47T	93.60T	90.11T	74.30T	67.69T	62.27T
Cash, Cash Equivalents and Short-Term Investments	15.97T	15.92T	14.11T	9.23T	8.62T	9.32T
Total Debt	38.44T	38.79T	36.56T	29.38T	26.50T	25.66T
Total Liabilities	56.48T	56.72T	54.87T	45.04T	40.53T	37.98T
Stockholders Equity	36.04T	35.92T	34.22T	28.34T	26.25T	23.40T
Cash Flow
Free Cash Flow	176.91B	-1.21T	-842.02B	-750.76B	-107.63B	-1.04T
Operating Cash Flow	4.89T	3.70T	4.21T	2.96T	3.72T	2.73T
Investing Cash Flow	-3.59T	-4.19T	-5.00T	-1.60T	-577.50B	-4.68T
Financing Cash Flow	-287.26B	197.24B	2.50T	-56.18B	-2.47T	2.74T

Toyota Motor Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3127.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7203, the sentiment is Positive. The current price of 3127 is above the 20-day moving average (MA) of 2937.73, above the 50-day MA of 2893.30, and above the 200-day MA of 2706.18, indicating a bullish trend. The MACD of 48.72 indicates Negative momentum. The RSI at 65.40 is Neutral, neither overbought nor oversold. The STOCH value of 77.41 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7203.

Toyota Motor Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7203	81 Outperform	¥38.23T	9.00	11.91%	2.91%	4.45%	-11.43%
7269	75 Outperform	$4.39T	10.56	13.92%	1.89%	2.53%	28.32%
6201	69 Neutral	$5.21T	19.91	4.89%	1.68%	2.02%	2.58%
7261	65 Neutral	$680.57B	30.73	1.11%	4.82%	-0.59%	-89.94%
7267	63 Neutral	$6.20T	10.71	5.17%	4.32%	1.96%	-39.57%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
7201	48 Neutral	$1.28T	―	-15.23%	―	-3.33%	-356.10%

Toyota Motor Corporate Events

Toyota Updates on Share Repurchase Plans Amid Regulatory Delays

Toyota Motor Corporation has announced an update regarding its planned tender offer for its own shares, contingent on the successful completion of a tender offer for Toyota Industries Corporation by Toyota Fudosan Co., Ltd., an affiliated company. The commencement of the tender offer for Toyota Industries has been delayed to February 2026 due to necessary regulatory procedures, pushing Toyota’s own share repurchase plan to March 2026 or later, pending board approval. This strategic move could impact Toyota’s market positioning and shareholder value.

The most recent analyst rating on (JP:7203) stock is a Buy with a Yen3300.00 price target. To see the full list of analyst forecasts on Toyota Motor stock, see the JP:7203 Stock Forecast page.

Toyota Submits Fourth Progress Report on Certification Reforms

Toyota Motor Corporation has submitted its fourth progress report to the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) regarding measures to prevent recurrence of model certification application issues. This report follows a correction order from MLIT, which highlighted the need for reforms in management involvement, regulations, record-keeping, and human resource development. Toyota has been implementing strategies such as strengthening foundations, monozukuri, and human development to ensure compliance and improve operations. The company is focusing on on-site management and systematic human resource development to address these issues effectively.

The most recent analyst rating on (JP:7203) stock is a Buy with a Yen3500.00 price target. To see the full list of analyst forecasts on Toyota Motor stock, see the JP:7203 Stock Forecast page.

Toyota Introduces Share-Based Compensation Plan for Senior Employees

Toyota Motor Corporation has announced the introduction of a share-based compensation plan for senior employees, utilizing an Employee Stock Ownership Plan (ESOP) trust structure. This plan involves the disposal of 547,500 shares of treasury stock to The Master Trust Bank of Japan, Ltd., aimed at rewarding eligible employees based on their performance and the company’s achievements. The impact on the secondary market is expected to be minimal, as the shares will not be released all at once.

The most recent analyst rating on (JP:7203) stock is a Buy with a Yen3800.00 price target. To see the full list of analyst forecasts on Toyota Motor stock, see the JP:7203 Stock Forecast page.

Toyota Reports FY2026 Q1 Financial Results Amid Market Challenges

Toyota Motor Corporation has released its FY2026 first-quarter financial results, highlighting the company’s performance amidst various economic and market challenges. The announcement underscores the impact of fluctuating currency exchange rates, changes in laws and regulations, and the competitive environment on Toyota’s operations, emphasizing the need for strategic adaptation to maintain its market position.

The most recent analyst rating on (JP:7203) stock is a Buy with a Yen3800.00 price target. To see the full list of analyst forecasts on Toyota Motor stock, see the JP:7203 Stock Forecast page.

Toyota Reports Q1 FY2026 Financial Results Amid Tariff Challenges

Toyota Motor Corporation reported its FY2026 first quarter financial results, showing a 3.5% increase in sales revenues compared to the previous year. However, the company experienced significant declines in operating income and net income, attributed to a 450 billion yen negative impact from U.S. tariffs. Despite these challenges, Toyota forecasts a slight increase in annual cash dividends per share, reflecting its commitment to shareholder returns.

The most recent analyst rating on (JP:7203) stock is a Buy with a Yen3800.00 price target. To see the full list of analyst forecasts on Toyota Motor stock, see the JP:7203 Stock Forecast page.

Toyota Expands Investment in Woven Capital to Boost Mobility Innovations

Toyota Motor Corporation has announced a significant investment in Woven Capital, L.P., a global investment fund established by its subsidiary Woven by Toyota. This move elevates Woven Capital to a specified subsidiary status, reflecting Toyota’s strategy to enhance its investment business and strengthen partnerships in innovative fields such as mobility, automation, and artificial intelligence. The investment is expected to have minimal impact on Toyota’s business performance but aligns with its goal of transforming into a mobility company and producing happiness for all stakeholders.

The most recent analyst rating on (JP:7203) stock is a Buy with a Yen3800.00 price target. To see the full list of analyst forecasts on Toyota Motor stock, see the JP:7203 Stock Forecast page.