Nissan Motor: Factoring in yen depreciation, higher raw material costs, expanded cost reductions

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Nissan Motor: Factoring in yen depreciation, higher raw material costs, expanded cost reductions

Global Research

18 June 2026ab

Nissan Motor Equities

JapanFactoring in yen depreciation, higher raw

material costs, expanded cost reductions Automobile Manufacturers

12-month rating Sell

12m price target ¥310.0A sustainable profit growth story is necessary

We adjust our earnings forecasts, largely to reflect yen depreciation (our assumption is

¥160/dollar) and higher raw material costs (equivalent to 2% of sales). Against a Price (17 Jun 2026) ¥350

pessimistic consensus, quarterly earnings could provide a surprise, but we see no clear RIC: 7201.T BBG: 7201 JP

signs of recovery in sales at the company, making it difficult for the share price to price in

sustained profit growth. We maintain our Sell rating. Trading data and key metrics

52-wk range ¥464-303

Earnings forecasts: Company needs to achieve positive manufacturing free cash Market cap. ¥1,223b/US$7.63b

flow Shares o/s 3,496m (ORD)

We are now assuming a yen–dollar exchange rate of ¥160/$ from June forward Free float 50%

(previously ¥155/$) and raw materials cost increases in FY3/27 equivalent to 2% of sales Avg. daily volume ('000) 29,618

(applying the same standard across the sector). Factoring in yen depreciation, higher raw Avg. daily value (m) ¥10,593.2

material costs, and an expansion in cost reductions, we estimate FY3/27 OP of Common s/h equity (03/27E) ¥4915b

¥200.2bn, in line with the company’s plan, and have revised our previously negative EPS P/BV (03/27E) 0.2x

estimate into positive territory (Figure 1). We forecast additional costs cuts from FY3/28, Net debt to EBITDA (03/27E) 15.3x

and in FY3/28-29 OP at about ¥400bn and manufacturing FCF turning positive, with NP

at about ¥200bn and EPS at ¥51-53.