Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious OutperformanceFind Stocks Now

Toyota shares hit record high on earnings, EV and chipmaking plays

Published 02/06/2024, 11:03 PM
Updated 02/06/2024, 11:03 PM
© Reuters.

Investing.com-- Shares of Toyota Motor Corp (TYO:7203) surged to a record high on Wednesday after the Japanese carmaker clocked strong quarterly earnings, and also announced more investment in electric vehicles and semiconductor manufacturing. 

Toyota’s Japanese shares jumped 4.7% to 3,283.0 yen, after hitting a record high of 3,361.0 yen. Toyota’s U.S.-listed shares (NYSE:TM) surged nearly 8% in overnight trade and were also at a record high of $218.66. 

Gains in Toyota spilled over into other automobile stocks, with smaller peers Nissan (OTC:NSANY) Motor Co., Ltd. (TYO:7201) and Suzuki Motor Corp. (TYO:7269) rising 3.5% and 2.6%, respectively, on Wednesday. The broader Nikkei 225 index was flat.

Toyota's shares saw extended gains after it clocked stronger-than-expected earnings in the December quarter, and also forecast a record-high profit for the fiscal year to March 31, 2024. 

Toyota’s operating profit for the December quarter was 1.68 trillion yen ($11.3 billion)- a 76% jump from last year. The firm forecast a record-high annual profit of 4.9 trillion yen ($33 billion). 

Earnings were boosted chiefly by booming sales of Toyota’s hybrid vehicles, which are high-margin items. A weaker yen also benefited the automaker’s overseas sales. 

In addition to the positive earnings, Toyota said it will make a bigger push into EV and hybrid vehicle production by investing an additional $1.3 billion at a plant in Kentucky. While global EV sales declined over the past year, Toyota’s hybrid sales- a class it had created nearly two decades ago with its Prius model- helped the automaker largely outpace its global peers. 

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

Additionally, the world’s largest automaker by sales will take a minority stake in a new semiconductor plant being constructed in Japan by Taiwanese chipmaker TSMC (TW:2330) (NYSE:TSM). The move will provide Toyota with more insulation against any potential disruptions in global chip supplies- a trend that had harangued automakers through the COVID-19 pandemic over the last three years. 

The positive moves largely overshadowed an ongoing scandal at Toyota’s Daihatsu unit, over the alleged faking of safety certification tests. Toyota slashed its annual vehicle sales target after suspending all shipments from Daihatsu in late-2023. 

The firm, and its Daihatsu unit are currently under investigation by Japanese authorities.  

 

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.