Honda Motor Company (NYSE:HMC) has built a reputation for fuel efficient, high quality, reliable and dependable motor vehicles, as well as for being a major innovator in the automotive industry. Now, Honda is leading the way in developing alternative energy vehicles. This summer Honda is releasing in California the FCX Clarity, a hydrogen-powered fuel celled vehicle. However, this is only one example of what Honda has in its plans for the future of motor vehicles; Honda is also at the forefront of the hybrid vehicle market.
The FCX Clarity can be leased for $600 a month and according to Honda gets the equivalent of 74 miles per gallon of gas. The hydrogen-powered fuel celled vehicle can be driven 280 miles on a tank. This vehicle can be mass produced, but needs an infrastructure of hydrogen filling stations.
Whether the answer to the energy crisis will come from a hydrogen-powered fuel cell vehicle, a hybrid electric vehicle or some other technology, Honda will surely be at the forefront, as it always has been in the past. Honda has the financial might, as well as a committed management, to provide consumers with what they want and what they need at the right time.
Honda (NYSE:HMC) reported $94 billion in revenues and $5 billion in net income for the full year 2007. With the economy probably already in a recession, despite it not yet meeting the "technical" definition of a recession, Honda seems poised to lead the auto industry once again when the economy eventually recovers; which it will! Honda's stock price has declined only 8% from a fifty-two week high of $37.80 to close on June 24 at $34.78.
Honda currently sells at a very reasonable Price Earnings multiple of 11.5, while most automotive companies are unable to operate at a profit even in good economic times. When the recovery begins, Honda will set new profit records and the Price Earnings multiple will expand, leading to excellent returns and appreciation in its stock price. With Honda you will be getting a play not only on the economic recovery, but also on alternative energy vehicles. Honda is a solid international blue chip with a consistent history of success. This "Green Giant" should also make your portfolio greener.
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