Toyota lifts guidance despite recalls clouding outlook

TOKYO, Feb 4 (BestGrowthStock) – Toyota Motor Corp (7203.T: ) on
Thursday lifted its cautious guidance for the financial year to
March despite escalating recall troubles that threaten to
derail a recovery at the world’s biggest automaker.

Toyota’s recall of more than 8 million vehicles due to
problems with unintended acceleration has punished its share
price, hurt its reputation and overshadowed what until just two
weeks ago had been expected to be an upbeat story of improving
earnings. [ID:nSGE612025]

Helped by government incentives to boost sales, Toyota
posted an operating profit of 189 billion yen ($2.1 billion) in
the three months to December, easily beating the 99 billion yen
estimated in an average of three brokerages polled by Thomson
Reuters I/B/E/S.

With less than two months left in the current financial
year, Toyota slashed what most analysts had considered an
excessively conservative operating loss forecast to 20 billion
yen from 350 billion yen.

That compares with an 38 billion yen annual loss forecast
in a survey of 19 brokerages by Thomson Reuters I/B/E/S.

Starmine SmartEstimates, which predicts earnings by putting
more weight on recent forecasts of top-rated analysts, has
Toyota posting an operating profit of 26 billion yen this year,
and improving to 647 billion yen next year.

Shares in Toyota have lost as much as 23 percent in the
last two weeks since it announced a multi-million-vehicle
recall for sticky accelerator pedals, underperforming a 2.7
percent drop in Tokyo’s TOPIX (.TOPX: ) index.
($1=90.89 Yen)

Stock Analysis

(Reporting by Chang-Ran Kim; Editing by Lincoln Feast)

Toyota lifts guidance despite recalls clouding outlook