Category: Money tips Release Date: 2007-05-01
Investment Points
Tianjin FAW Toyota Motor Company for the long-term growth of confidence, due to input methods and accounting policies of the reason for Toyota's business in the initial stage of investment is often not very good profit performance, but potentially very strong. Production after two to three years grace period, profits and other performance will meet or exceed their global average level of returns (sales profit rate of 6-8%).
Toyota, a plant has reached a higher level of profitability (more than 10%), while in 2005 the second production plant in 2007 began to profit from the significant growth in three plant put into operation in May 2007 is expected to begin in 2008 profit from the ability to rapidly upgrade.
2010, Toyota will launch three new cars in Tianjin, the existing product that is 4-5 years average production for the Model, future product launch is relatively abundant, with 47 million units production capacity will be fully utilized.
Toyota's unique manufacturing technology and JIT production systems to ensure that the assets to maximize operational efficiency, the company in 2006 the total asset turnover ratio is about 3.5 times, if only to consider a factory and two factories in assets, more than four-fold, much higher than its competitors average investment cost and financial cost savings brought about by the continuing market competitiveness.
In 2006 the company headquarters of the most difficult year, new products and business policy is hard to merchandise in a substantial adjustment, coupled with the low-end economy car market downturn, the company sales grew only 3%, the fierce market competition to force prices lower, profitability, there declined.
Behind poor sales, asset quality and management capacity has been enhanced, and the second largest shareholder Tianqijituan to honor promises to pay the debt stock restructuring to improve the company's asset quality, significant reduction in interest-bearing liabilities. R & D and manufacturing capabilities enhanced, Wei Zhi-car market and obtain a preliminary approval, we will soon-to-market sedan for cautious optimism.
With the introduction of new models and management capabilities, the Department is expected to gradually bottom out, beginning in 2007, has the potential to provide a positive impact on corporate earnings.
Based on the conditions of relatively cautious, we maintain the company 2006,2007,2008-year earnings per share was 0.28 yuan, 0.38 yuan, 0.60 yuan prediction, equivalent to the current share price equivalent to 30 times, 22 times and 14 times earnings, based on our the long-term prospects for the company's relatively optimistic judgments, and the certainty of corporate earnings growth is relatively good, we offer 18 times the company's 2008 earnings valuation, target price of 10.8 yuan, relative to the current stock price rose about 30% still maintain the buying into the investment grade.
