Toyota Motor Corporation (TM) Discounted Future Market Cap

Toyota Motor Corporation

TM (NYSE)

(%)

Valuation
Toyota Motor Corporation Discounted Future Market Cap

"""
    Model: Discounted Future Market Cap

# Render model description
model.render_description(r"""
## Discounted Future Market Cap

This model estimates the intrinsic value of a common share by projecting the Future Market Capitalization using the estimated PE Ratio and then discounting it to the Present using an Annual Required Rate of Return.
""")

# Initialize assumptions
assumptions.init({
    "data": {
        "%discount_rate": None,
        "beta": data.get("profile:beta", default=1),
        "%risk_free_rate": data.get("treasury:year10"),
        "%market_premium": data.get("risk:totalEquityRiskPremium"),
        "pe_ratio": data.get("ratio:priceEarningsRatio"),
        "%revenue_growth_rate": None,
        "%net_income_margin": None,
        "historical_years": 10,
        "projection_years": 5,
    },
    "hierarchies": [{
        "parent": "%discount_rate",
        "children": ["beta", "%risk_free_rate", "%market_premium"]
    }]
})

# Calculate cost of equity
cost_of_equity = assumptions.get("%risk_free_rate") + assumptions.get("beta") * assumptions.get("%market_premium")
assumptions.set("%discount_rate", cost_of_equity)

# Compute metrics
data.compute({
    "%grossMargin": "income:grossProfit / income:revenue",
    "%operating_margin": "income:operatingIncome / income:revenue",
    "%netMargin": "income:netIncome / income:revenue",
    "%revenueGrowthRate": "function:growth:income:revenue",
    "%netIncomeGrowthRate": "function:growth:income:netIncome",
    "%totalStockholdersEquityGrowthRate": "function:growth:balance:totalStockholdersEquity",

# Calculating NOPAT (Net Operating Profit After Taxes)
    "%taxRate": "income:incomeTaxExpense / income:incomeBeforeTax",
    "incomeTax": "income:operatingIncome * %taxRate",
    "nopat": "income:operatingIncome - incomeTax",

# Calculating Invested Capital
    "investedCapital": [
        "balance:totalNonCurrentAssets", "-", "balance:cashAndCashEquivalents", "+",
        "balance:totalCurrentAssets", "-", "balance:totalCurrentLiabilities"
    ],
    "%roic": "nopat / investedCapital",
})

data.set_default_range(f"{-assumptions.get('historical_years')}->0")

assumptions.set("%net_income_margin", data.average(f"%netMargin"))
assumptions.set_bounds(
    "%net_income_margin", low=0, high="100%"
)

assumptions.set("%revenue_growth_rate", data.average(f"%revenueGrowthRate"))
assumptions.set_bounds(
    "%revenue_growth_rate", low=0, high="25%"
)

# Compute forecasted values and ratios
data.compute({
    "income:revenue": f"""
        income:revenue:-1 * 
        (1 + {assumptions.get('%revenue_growth_rate')})
    """,
    "%revenueGrowthRate": "function:growth:income:revenue",
    "income:netIncome": f"income:revenue * {assumptions.get('%net_income_margin')}",
}, forecast=assumptions.get("projection_years"))

projected_revenue = data.get("income:revenue")
projected_net_income = data.get(f"income:netIncome:{assumptions.get('projection_years')}")

shares_outstanding = data.get("income:weightedAverageShsOut")
future_market_cap = assumptions.get("pe_ratio") * projected_net_income
discounted_future_market_cap = future_market_cap / (
            (1 + assumptions.get("%discount_rate")) ** assumptions.get("projection_years"))

stock_value = discounted_future_market_cap / shares_outstanding

# Set the final value
model.set_final_value({
    "value": stock_value,
    "units": "$"
})

# Render results
model.render_results([
    [stock_value, "Present Value", "$"],
    [projected_net_income, "Estimated net income", "$"],
    [future_market_cap, "Estimated market capitalization", "$"],
    [discounted_future_market_cap, "Market capitalization discounted to present", "$"],
    [shares_outstanding, "Shares Outstanding", "#"],
    [data.get("income:eps"), "Earnings Per Share (EPS)", "$"],
    [data.get("profile:price"), "Market Price", "$"],
    [data.get("ratio:priceEarningsRatio"), "Price to Earnings (PE) Ratio", "#"]
])

# Render chart
model.render_chart({
    "data": {
        "income:revenue": "Revenue",
        "income:netIncome": "Net Income"
    },
    "start": -assumptions.get("historical_years"),
    "end": "*",
    "properties": {
        "title": "Historical and forecasted data",
        "set_editable": [
            "income:revenue",
            "income:netIncome"
        ]
    }
})

# Render table for estimated future values
model.render_table({
    "data": {
        "income:revenue": "Revenue",
        "%revenueGrowthRate": "Revenue Growth Rate",
        "income:netIncome": "Net Income",
    },
    "start": -1,
    "end": "*",
    "properties": {
        "title": "Estimated Future Values",
        "order": "ascending",
        "number_format": "M"
    }
})

# Render historical values table
model.render_table({
    "data": {
        "income:revenue": "Revenue",
        "income:costOfRevenue": "Cost of Revenue",
        "income:grossProfit": "Gross Profit",
        "%grossMargin": "Gross Margin",
        "income:operatingIncome": "Operating Income",
        "%operating_margin": "Operating Margin",
        "income:netIncome": "Net Income",
        "%netMargin": "Net Margin",
    },
    "start": -assumptions.get("historical_years"),
    "end": 0,
    "properties": {
        "title": "Historical Values",
        "display_averages": True,
        "order": "descending",
        "number_format": "M"
    },
})

# Render historical growth rates table
model.render_table({
    "data": {
        "income:revenue": "Revenue",
        "%revenueGrowthRate": "Revenue Growth Rate",
        "income:netIncome": "Net Income",
        "%netMargin": "Net Margin",
        "%netIncomeGrowthRate": "Net Income Growth Rate",
        "balance:totalStockholdersEquity": "Stockholders Equity",
        "%totalStockholdersEquityGrowthRate": "Equity Growth Rate",
        "%roic": "Return on Invested Capital (ROIC)",
        "nopat": "After-tax Operating Income",
        "%taxRate": "Income Tax Rate",
        "investedCapital": "Invested Capital",
    },
    "start": -assumptions.get("historical_years"),
    "end": 0,
    "properties": {
        "title": "Historical Growth Rates",
        "display_averages": True,
        "order": "descending",
        "number_format": "M"
    },
})

# Set description for assumptions
assumptions.set_description({
    "%discount_rate": r"""
        ## Discount Rate

`Discount Rate` = `Cost of Equity` = `Risk Free Rate` + `Beta` * `Market Premium`

The cost of equity is the theoretical rate of return that an equity investment should generate. It is calculated using the CAPM formula.

[Read More](https://www.investopedia.com/terms/c/costofequity.asp#mntl-sc-block_1-0-20)
    """,

"beta": r"""
        ## Beta

Beta is a value that measures the price fluctuations (volatility) of a stock with respect to fluctuations in the overall stock market.
    """,

"%risk_free_rate": r"""
        ## Risk-Free Rate

The risk-free rate represents the interest an investor would expect from an absolutely risk-free investment over a specified period of time.
        By default, it is equal to the current yield of the U.S. 10 Year Treasury Bond.
    """,

"%market_premium": r"""
        ## Market Premium

Market risk premium represents the excess returns over the risk-free rate that investors expect for taking on the incremental risks connected to the equities market.
    """,

"pe_ratio": r"""
        ## Price to Earnings (PE) Ratio

Estimated Price to Earnings (PE) Ratio at the end of the projection period.

`Future Market Cap` = `PE Ratio` * `Projected Net Income`
    """,

"%revenue_growth_rate": r"""
        ## Revenue Growth Rate

The annual revenue growth rate is applied to projected revenue starting from the second projection year onward.
    """,

"%net_income_margin": r"""
        ## Net Income Margin

Net Income expressed as a percentage of Revenue.
    """,

"historical_years": r"""
        ## Historical Years

The number of historical years used to calculate averages for historical data.
    """,

"projection_years": r"""
        ## Projection Years

The number of years for projecting the analysis into the future.
    """,
})

print("End of model.")

Estimated Value

USD

Market Price USD

* Values are not guaranteed, please do your own
research before making investment decisions.

Discounted Future Market Cap

Interactive Assumptions

Discount Rate Discount Rate `Discount Rate` = `Cost of Equity` = `Risk Free Rate` + `Beta` * `Market Premium` The cost of equity is the theoretical rate of return that an equity investment should generate. It is calculated using the CAPM formula. Read More	%
↳ Beta Beta Beta is a value that measures the price fluctuations (volatility) of a stock with respect to fluctuations in the overall stock market.	#
↳ Risk Free Rate Risk-Free Rate The risk-free rate represents the interest an investor would expect from an absolutely risk-free investment over a specified period of time. By default, it is equal to the current yield of the U.S. 10 Year Treasury Bond.	%
↳ Market Premium Market Premium Market risk premium represents the excess returns over the risk-free rate that investors expect for taking on the incremental risks connected to the equities market.	%
Pe Ratio Price to Earnings (PE) Ratio Estimated Price to Earnings (PE) Ratio at the end of the projection period. `Future Market Cap` = `PE Ratio` * `Projected Net Income`	#
Revenue Growth Rate Revenue Growth Rate The annual revenue growth rate is applied to projected revenue starting from the second projection year onward.	%
Net Income Margin Net Income Margin Net Income expressed as a percentage of Revenue.	%
Historical Years Historical Years The number of historical years used to calculate averages for historical data.	#
Projection Years Projection Years The number of years for projecting the analysis into the future.	#

Results
Present Value	183.2 USD
Estimated net income	31.09 Bil. USD
Estimated market capitalization	306.6 Bil. USD
Market capitalization discounted to present	238.8 Bil. USD
Shares Outstanding	1.3 Bil.
Earnings Per Share (EPS)	22.87 USD
Market Price	226.9 USD
Price to Earnings (PE) Ratio	9.86

Historical and forecasted data

Monetary values in USD

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Edit Chart Values	2026-03-31	2027-03-31	2028-03-31	2029-03-31	2030-03-31

↳ Growth Rate

Estimated Future Values

Monetary values in USD amounts except #	2025 Mar 31	LTM Jan 31	2026 Mar 31	2027 Mar 31	2028 Mar 31	2029 Mar 31	2030 Mar 31
Revenue	320,213	319,066	330,988	342,126	353,638	365,538	377,838
Revenue Growth Rate	7.47%	-0.358%	3.36%	3.36%	3.36%	3.36%	3.36%
Net Income	31,764	29,922	27,234	28,150	29,097	30,076	31,089

Monetary values in USD

amounts except #

2025
Mar 31

LTM
Jan 31

2026
Mar 31

2027
Mar 31

2028
Mar 31

2029
Mar 31

2030
Mar 31

Revenue

320,213

319,066

330,988

342,126

353,638

365,538

377,838

Revenue Growth Rate

7.47%

-0.358%

3.36%

Net Income

31,764

29,922

27,234

28,150

29,097

30,076

31,089

Historical Values

Monetary values in USD amounts except #	Average	LTM Jan 31	2025 Mar 31	2024 Mar 31	2023 Mar 31	2022 Mar 31	2021 Mar 31	2020 Mar 31	2019 Mar 31	2018 Mar 31	2017 Mar 31	2016 Mar 31
Revenue	277,013	319,066	320,213	297,945	279,660	257,783	245,748	277,729	272,605	276,402	247,685	252,305
Cost of Revenue	225,264	261,721	256,365	236,048	232,142	208,725	202,111	227,689	223,507	224,749	204,041	200,804
Gross Profit	51,749	57,344	63,847	61,896	47,518	49,057	43,636	50,040	49,098	51,653	43,644	51,501
Gross Margin	18.66%	17.97%	19.94%	20.77%	16.99%	19.03%	17.76%	18.02%	18.01%	18.69%	17.62%	20.41%
Operating Income	24,611	28,021	31,967	35,367	20,511	24,610	19,846	22,310	22,255	22,578	17,899	25,352
Operating Margin	8.84%	8.78%	9.98%	11.87%	7.33%	9.55%	8.08%	8.03%	8.16%	8.17%	7.23%	10.05%
Net Income	22,987	29,922	31,764	32,671	18,451	23,414	20,275	18,934	16,982	23,463	16,434	20,544
Net Margin	8.23%	9.38%	9.92%	10.97%	6.6%	9.08%	8.25%	6.82%	6.23%	8.49%	6.64%	8.14%

Historical Growth Rates

Monetary values in USD amounts except #	Average	LTM Jan 31	2025 Mar 31	2024 Mar 31	2023 Mar 31	2022 Mar 31	2021 Mar 31	2020 Mar 31	2019 Mar 31	2018 Mar 31	2017 Mar 31	2016 Mar 31
Revenue	277,013	319,066	320,213	297,945	279,660	257,783	245,748	277,729	272,605	276,402	247,685	252,305
Revenue Growth Rate	3.36%	-0.358%	7.47%	6.54%	8.49%	4.9%	-11.52%	1.88%	-1.37%	11.59%	-1.83%	11.23%
Net Income	22,987	29,922	31,764	32,671	18,451	23,414	20,275	18,934	16,982	23,463	16,434	20,544
Net Margin	8.23%	9.38%	9.92%	10.97%	6.6%	9.08%	8.25%	6.82%	6.23%	8.49%	6.64%	8.14%
Net Income Growth Rate	8.18%	-5.8%	-2.78%	77.07%	-21.2%	15.48%	7.08%	11.5%	-27.62%	42.77%	-20%	13.49%
Stockholders Equity	186,226	253,447	239,475	226,098	213,305	215,611	237,001	1,776	179,542	176,268	157,195	148,763
Equity Growth Rate	1,198%	5.83%	5.92%	6%	-1.07%	-9.03%	13,240%	-99.01%	1.86%	12.13%	5.67%	6.39%
Return on Invested Capital (ROIC)	59.21%	5.49%	6.49%	7.56%	4.32%	5.43%	4.3%	592.1%	6.15%	6.82%	5.29%	7.39%
After-tax Operating Income	18,456	21,692	23,870	25,751	13,938	17,728	15,447	16,864	16,703	18,893	13,495	18,630
Income Tax Rate	24.92%	22.59%	25.33%	27.19%	32.05%	27.96%	22.17%	24.41%	24.95%	16.32%	24.61%	26.51%
Invested Capital	288,162	394,992	367,861	340,421	322,355	326,406	358,789	2,848	271,790	277,151	255,214	251,955