One-glance verdict
Undervalued
$6.32 our estimate vs market $2.38
62% below our estimate, below the bear case
Fundamentals snapshot
Mitsubishi Motors Corporation
MMTOF · PNK · Consumer Cyclical · Auto Manufacturers
Current price
$2.38
52-week range
$1.75 - $2.90
Market cap
$3.19B
Balance sheet
Healthy
12.38x Strong cushion
Net debt $679.18M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 3.9% last year.
- Reward Returns 2.3% on equity, ahead of 50% of its peers.
- Risk Stock trades 48594.9% above its 5-year average P/E.
- Risk Operating margin compressed from 7.7% to 1.6% over 3 years.
What this company does
Mitsubishi Motors Corporation
Mitsubishi Motors Corporation builds and sells cars, like SUVs and electric vehicles, all around the world. Their main income comes from selling these cars and also from financial services related to car purchases, which is important because it shows where their money is really made.
How the company got here
Mitsubishi Motors Corporation has a long history, with roots tracing back to 1870 when Yataro Iwasaki founded a shipping company. Over the decades, the Mitsubishi group expanded into various industries, including aviation and motors. Mitsubishi Motors Corporation was officially established in 1970, building on the automotive division of Mitsubishi Heavy Industries. A significant turning point was its inclusion in the Renault–Nissan–Mitsubishi Alliance in 2016, which aimed to leverage shared resources and technology. The company has faced challenges and undergone restructuring, including a capital injection in 2004 to revitalize its business and a scaling down of Nissan's stake in 2024.
What it actually does
Mitsubishi Motors Corporation designs, manufactures, and sells a range of vehicles and related parts worldwide. Their product lineup includes electric and hybrid vehicles, SUVs (Sport Utility Vehicles), pickup trucks, minivans, and smaller cars, all sold under the Mitsubishi brand name. The company also has a financial services arm that supports its automotive sales through leasing and financing options.
Automobile Business
This is the core of Mitsubishi Motors' operations, where the company designs, manufactures, and sells vehicles. This segment includes a variety of car types such as electric vehicles (EVs), plug-in hybrid electric vehicles (PHEVs), SUVs, pickup trucks, minicars, and other passenger cars. These vehicles are sold in numerous markets globally, including Japan, North America, Europe, Asia, and Oceania. The vast majority of the company's revenue is generated from this segment, making it the primary driver of its financial performance.
Financial Services
This segment of Mitsubishi Motors focuses on providing financial support for vehicle purchases. It includes services like automobile leasing and sales finance, which help customers acquire Mitsubishi vehicles. While a smaller part of the overall business compared to vehicle sales, this segment plays a crucial role in facilitating sales and enhancing customer convenience by offering financing solutions.
What management is betting on now
Mitsubishi Motors is focusing on a mid- to long-term vision to strengthen its brand and enhance customer satisfaction. This strategy involves concentrating investments in markets where the company has a competitive edge and developing distinctive products and technologies. They are also working on improving profitability by expanding value-chain businesses and enhancing cost competitiveness through structural transformation, including the use of AI and digital transformation. A key part of this is launching new and refreshed models, with a particular emphasis on adventure-oriented and off-road-capable vehicles, and re-entering segments like pickup trucks.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value $6.32 vs current price $2.38
Our most-likely fair value is $6.32 a share — about 165.6% above today's price of $2.38, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net debt $679.2M. Interest coverage 12.4x.
Net debt
$679.18M
Interest coverage
12.38x
Mitsubishi Motors Corporation's profit covers its interest bill about 12.4 times over. which is stronger than every peer shown here and 4 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
MMTOF
BASELINE
Mitsubishi Motors Corporation
Total debt $2.64B Interest coverage 12.38x This is the baseline the peer rows are being compared against.
Total debt $5.49B Interest coverage 4.71x -62% vs MMTOF Carries about 2.6x less debt cushion than MMTOF.
Total debt $2.06B Interest coverage 0.26x -98% vs MMTOF Carries about 47.4x less debt cushion than MMTOF.
Total debt $3.66B Interest coverage -36.82x -100% vs MMTOF This peer has almost no interest-payment cushion compared with MMTOF.
Total debt $6.02B Interest coverage -5.29x -100% vs MMTOF This peer has almost no interest-payment cushion compared with MMTOF.
Total debt — Interest coverage -4.24x -100% vs MMTOF This peer has almost no interest-payment cushion compared with MMTOF.
What you should know
The case for and against MMTOF
3 Rewards
2 Risks
Rewards
-
Revenue grew 3.9% last year.
-
Returns 2.3% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 3/10 years.
Risks
-
Stock trades 48594.9% above its 5-year average P/E.
-
Operating margin compressed from 7.7% to 1.6% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
47.60x
Forward P/E
—
P/B
0.55x
P/S
0.00x
EV/EBITDA
0.94x
PEG ratio
—
Profitability
How much profit each dollar creates
Gross margin
15.7%
Operating margin
1.6%
Net margin
0.4%
ROE
2.3%
ROA
2.2%
Health
Liquidity and balance-sheet strength
Debt / equity
0.43x
Current ratio
1.40x
Quick ratio
0.79x
Total debt
$2.64B
Total cash
$1.96B
Growth
How the business has been compounding
Revenue TTM
$18.53B
Revenue 5Y CAGR
5.6%
EPS TTM
0.05
EPS 5Y CAGR
-59.6%
Cash flow
How much cash the business throws off
Operating CF TTM
$227.85M
Free CF TTM
$-555.31M
FCF margin
-3.0%
Dividend
Shareholder payout
Yield
2.6%
Payout ratio
125.3%
Last ex-div date
2027-03-30