We recently published a list of 10 Cheapest Stocks to Buy On Robinhood. In this article, we are going to take a look at where Honda Motor Co., Ltd. (NYSE:HMC) stands against other cheapest stocks to buy on Robinhood.
While the market has been on an upward trajectory for nearly two years now, the combination of seasonal trends, strong retail, and corporate activity, and positive market momentum following the November election still suggests a potential for continued growth in U.S. equities.
Goldman Sachs’ Scott Rubner predicts a year-end rally that will push the S&P to 6,200 points as reported by Bloomberg on November 25. He attributes this potential rally to growing retail enthusiasm in equities and crypto, seasonal trading patterns, and increasing corporate buyback demand.
Rubner noted that the recent consolidation phase is typical, and highlighted significant inflows into U.S. equities, with the broader market gaining over 3% since the November 5 presidential vote and the Russell 2000 rising 6.5%. Historically, strong market performance in election years tends to extend into January, with the capital being deployed at the start of the new year.
READ ALSO: Jim Cramer’s Lightning Round: 9 Stocks in Spotlight and 10 Best Renewable Energy Penny Stocks to Invest In.
Strategic Investment Moves in a Shifting Economy
In an interview with Seana Smith and Madison Mills of Yahoo Finance, Jim Smigiel, SEI’s Chief Investment Officer, highlighted several key insights for investors, in light of President-elect Donald Trump’s pro-growth policies. He warned that these policies could lead to higher inflation and rising interest rates, which may impact investment strategies. For investors, the focus should be on understanding how inflation and rates can affect different assets and staying prepared for potential shifts in the market.
Smigiel sees opportunities in small-cap stocks, value stocks, and financials, which are expected to benefit from the current reflationary environment. He suggested investors consider diversifying their portfolios to reduce reliance on highly concentrated growth sectors like tech. Active management, where professional fund managers select investments, could also be a useful strategy to broaden exposure and adapt to market changes.
While higher rates could eventually pose challenges, Smigiel noted that small-cap stocks remain attractive for now due to improved debt structures, providing a window of opportunity until around 2026. Investors should keep an eye on rising yields, as it might signal a need to shift toward more defensive investments. Diversification remains critical in managing risks during this period.
Our Methodology
For this article, we checked all the large-cap companies trading on Robinhood with at least 50% positive analyst ratings. We narrowed our list to nearly 40 stocks that were trading below a forward price-to-earnings multiple of under 15. We also skipped the stocks that were trading above or at their industry median despite trading below a PE ratio of 15. Finally, we chose the 10 cheapest stocks to buy based on their average analyst price target upside as of November 25 (pre-market open). These stocks are also popular among hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A fleet of motorcycles and vehicles lined up in an assembly line with workers in the background.
Honda Motor Co., Ltd. (NYSE:HMC)
Market Cap: $41.4 billion
FWD PE Ratio: 5.85
Average Price Target Upside: 38.53%
Honda Motor Co., Ltd. (NYSE:HMC) designs, manufactures, and sells motorcycles, automobiles, power products, and other goods globally. It operates through several segments including Motorcycles, Automobiles, Financial Services, and Power Products. The company also supplies spare parts and after-sale services through a network of dealers and distributors.
Honda (NYSE:HMC) demonstrated solid financial performance in the first half of FY 2025, driven by strong motorcycle sales and stable operations in key markets like North America and Japan. Despite challenges in China and rising costs, the company maintained its full-year profit forecast and continues to prioritize shareholder returns through dividends and share buybacks.
The company highlighted steady sales growth in motorcycles and ICE/HEV vehicles in FQ2 2025 with motorcycle sales reaching 10.38 million units, while automobile and power product sales stood at 1.78 million and 1.65 million units, respectively. Operating profit saw a ¥46 billion (¥1 = US$0.0065) increase, with higher unit sales and pricing offset by increased incentives, R&D expenses, and currency impacts. However, total automobile sales declined by 155,000 units year-over-year, largely due to reduced sales in China.
Honda (NYSE:HMC) maintained its full-year operating profit forecast of ¥1.42 trillion but reduced its profit forecast attributable to owners to ¥950 billion, reflecting weakened Chinese sales and lower domestic affiliate profits. Interim and annual dividends are set at ¥34 and ¥68 per share, respectively, with an additional ¥100 billion allocated for share buybacks. Full-year forecasts include higher motorcycle sales in Asia, unchanged automobile and power product forecasts, and adjustments for currency fluctuations and increased costs.
Overall, HMC ranks 8th on our list of cheapest stocks to buy on Robinhood. While we acknowledge the potential of HMC as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than HMC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
