Craigla1

Toyota: Undeniably Cheap Despite Industry Slump

This is a superficial analysis, with an emphasis on valuing TM based on earnings and sales multiples. The problem TM faces is the fact they - over the years - have taken on a ton of debt. With over $100 billion in debt, TM has an enterprise value of $213 billion. Before they announced their latest guidance of a loss for this year, they forecast a profit of $12 billion (this a couple of months ago, at prevailing exchange rates).

A company in a very challenged, cyclical and capital intensive industry with an enterprise value of $213 billion, relative to this level of profits, is extremely over-valued.