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Nissan Motor Co Ltd ADR NSANY

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Morningstar’s Analysis

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Economic Moat

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Nissan Cuts Losses in Fiscal Q2 but Still Has Long Road to Turnaround; Maintain JPY 1,480 FVE

Richard Hilgert Senior Equity Analyst

Analyst Note

| Richard Hilgert |

No-moat rated Nissan reported a fiscal second-quarter loss per share of JPY 11.33, blowing past the CapIQ consensus estimated loss per share of JPY 45.10 as the company continues its struggle to turnaround operations. Even though operating results continued to be impacted by the pandemic, it also shows a company that is battling to contain cost while launching four new models this fiscal year and eight more next year. An aged product portfolio, lower daily rental fleet sales, and strict incentive policies have reduced volumes and resulted in share losses.

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Company Profile

Business Description

While Nissan sells about 4 million vehicles, the combined Renault-Nissan Alliance sells about 10 million, placing the alliance in the top three of all automakers in the world. Nissan's financial services subsidiary provides consumers with auto loans and leases. In addition, the subsidiary also finances Nissan's sales to its dealerships (known as floor-plan financing). Nissan is 43.4% owned by French automaker Renault, while Nissan in turn owns 15% of Renault. The Alliance also has controlling interests in AvtoVAZ (Lada) in Russia and Mitsubishi Motors in Japan.

Contact
1-1, Takashima 1-chome, Nishi-ku, Yokohama-shi
Kanagawa, 220-8686, Japan
Sector Consumer Cyclical
Industry Auto Manufacturers
Most Recent Earnings Sep 30, 2020
Fiscal Year End Mar 31, 2020
Stock Type
Employees 153,731

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