This isn’t the sort of news that investors (or Toyota owners) want to hear. Toyota (TM) announced on Tuesday that they’re recalling almost 100,000 Tundra pickups and 3,500 Lexus LX 600 luxury SUV. The reason? The company needs to fix a problem that causes the engines to lose power while driving. Some of the engines in these trucks and SUVs were found to contain manufacturing debris that was left inside where it can knock around causing the engine to run roughly and sometimes stall or not start. This recall only applies to 2022 and 2023 models, and just the gas-powered versions. Hybrid vehicles are not affected. This news, which has caused Toyota’s stock to drop, follows a 2.8% slide on Monday when the Wall Street Journal reported that Japanese automakers, including Toyota, moved to suspend shipment of certain car models pending an investigation into certification issues related to safety tests.
Reliable Reputation In Jeopardy
Before this manufacturing mishap, Toyota was seen as a highly revered brand—from both consumer and investor perspectives. For the car or truck owner, Toyotas are thought of as highly reliable. Back in April, analysts were rating TM as a strong buy, with company shares returning 5.1% while the Zacks S&P 500 composite rose just .8%. At the start of the year, Toyota’s share price was $181.37, rising as high as $254.77 on March 22. By the end of May, this had dropped to $217.51. This latest news does nothing to stop this downward trajectory. As of early afternoon, TM is down by 1.25% to $207.75.
What The Analysts Are Saying
As of now, analysts at UBS, Citigroup, JP Morgan, and Zachs Research still have a Buy rating on TM stock. Price targets, which might also be lagging the late-breaking news, were at an average of $247.47. The company, for its part, has gotten ahead of this story and has committed to inspection and, if needed, repair of all affected vehicles at no charge.
Neither Julie Stoller nor Stocks.News have positions in the stocks mentioned in this article. Please see our disclosure page for more information.
Did you find this insightful?
Bad
Just Okay
Amazing
Disclaimer: Information provided is for informational purposes only, not investment advice. We do not recommend buying or selling stocks. Stock price discussions are based on publicly available data. Readers should conduct their own research or consult a financial advisor before investing. Owners of this site have current positions in stocks mentioned thru out the site, Please Read Full Disclaimer for details Here https://app.stocks.news/page/disclaimer