Canon (CAJPY) AI Stock Analysis

• Market Cap: $28.78B
• Dividend Yield: 3.07%
• Average Volume (3M): 6.84K
• Price to Earnings (P/E): 24.5
• Beta (1Y): 0.42
• Revenue Growth: 4.53%
• EPS Growth: -38.56%
• Country: US
• Employees: 111,733
• Sector: Technology
• Sector Strength: 98
• Industry: Computer Hardware
• EPS (TTM): 0.62
• Shares Outstanding: 1,333,763,000
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 6,840
• PEG Ratio: -0.83
• Price to Book (P/B): 1.46
• Price to Sales (P/S): 1.10
• P/FCF Ratio: 13.39
• Enterprise Value/Market Cap: 1.09
• Enterprise Value/Revenue: <0.01
• Enterprise Value/Gross Profit: 0.01
• Enterprise Value/Ebitda: 0.04
• 1Y Price Target: $33.00
• Price Target Upside: 10.85% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 76 Outperform
• Price Target: $33.00 ▲(10.85% Upside)

Canon's overall stock score is driven by its strong financial performance and solid cash flow generation, which are the most significant factors. The technical analysis indicates moderate bullish momentum, supporting the stock's short-term outlook. However, the relatively high P/E ratio suggests a cautious approach due to valuation concerns, although the attractive dividend yield provides some compensation for investors.

Canon Business Overview & Revenue Model

Company Description

Canon Inc. is a multinational corporation headquartered in Tokyo, Japan, specializing in imaging and optical products, including cameras, camcorders, printers, and medical equipment. Established in 1937, Canon operates in several key sectors, including consumer imaging, professional imaging, and office solutions. The company is renowned for its innovative technologies in digital imaging and printing, providing high-quality products for both individual consumers and businesses. Canon's extensive product lineup includes digital single-lens reflex (DSLR) cameras, mirrorless cameras, multifunction printers, and large-format printers, catering to a diverse global market.

How the Company Makes Money

Canon generates revenue through multiple key streams, primarily from the sale of imaging products and solutions. Its core revenue comes from the consumer and professional imaging segments, which include cameras, lenses, and related accessories. The company also earns significant income from its printer and office equipment division, providing multifunction printers and document solutions to businesses. Additionally, Canon has a growing presence in the medical imaging sector, offering products like digital radiography systems. Partnerships with retailers and distributors worldwide facilitate product sales, while a focus on developing innovative technologies and services enhances customer loyalty and recurring revenue. Canon also leverages a subscription model for some of its software and printing services, further diversifying its revenue streams.

Canon Financial Statement Overview

Summary

Canon exhibits robust financial health with strong revenue growth, stable balance sheet, and solid cash flow generation. The company demonstrates efficient operations and a prudent capital structure with low leverage. Although there are minor concerns with decreasing EBIT margins and the need for further profitability enhancement, the overall trajectory is positive, positioning Canon well for future growth in the competitive computer hardware industry.

Income Statement

Canon's income statement reflects strong performance with a gross profit margin of 47.5% and a net profit margin of 3.5% in 2024. The revenue growth rate was 7.85% from 2023 to 2024, indicating positive growth momentum. EBIT and EBITDA margins were 6.2% and 12.0% respectively, demonstrating efficient operations and solid earnings before interest, tax, depreciation, and amortization. However, there was a decline in EBIT margin compared to the previous year, which poses a minor concern.

Balance Sheet

The balance sheet shows a healthy financial structure with a debt-to-equity ratio of 0.20, indicating low leverage. The return on equity (ROE) is 4.73%, which is moderate but indicates room for improvement in profitability. The equity ratio stands at 58.7%, showcasing stability with a significant portion of assets funded by equity. The increase in total assets and equity over the years reflects positive growth, yet the slight rise in debt requires monitoring.

Cash Flow

Canon's cash flow statement reveals strong free cash flow growth of 67.45% from 2023 to 2024, indicating enhanced cash generation capacity. The operating cash flow to net income ratio is 3.79, reflecting effective cash conversion from earnings. The free cash flow to net income ratio is 2.31, showcasing a solid ability to generate free cash relative to net income. Despite the positive cash flow metrics, attention should be paid to the investment in capital expenditures.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.58T	4.51T	4.18T	4.03T	3.51T	3.16T
Gross Profit	2.17T	2.14T	1.97T	1.83T	1.63T	1.38T
EBITDA	722.85B	540.37B	631.71B	579.98B	524.60B	358.96B
Net Income	172.31B	160.03B	264.51B	243.96B	214.72B	83.32B
Balance Sheet
Total Assets	5.87T	5.77T	5.42T	5.10T	4.75T	4.63T
Cash, Cash Equivalents and Short-Term Investments	701.92B	506.34B	405.14B	373.01B	404.77B	407.75B
Total Debt	1.02T	663.50B	517.32B	417.41B	320.97B	506.17B
Total Liabilities	2.39T	2.12T	1.81T	1.75T	1.65T	1.84T
Stockholders Equity	3.22T	3.38T	3.35T	3.11T	2.87T	2.58T
Cash Flow
Free Cash Flow	365.85B	369.83B	220.88B	74.08B	273.68B	169.09B
Operating Cash Flow	601.55B	606.83B	451.19B	262.60B	451.03B	333.81B
Investing Cash Flow	-261.64B	-297.32B	-275.37B	-180.82B	-207.26B	-155.44B
Financing Cash Flow	-144.36B	-226.00B	-156.73B	-146.84B	-267.37B	-183.45B

Canon Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 29.77
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CAJPY, the sentiment is Positive. The current price of 29.77 is above the 20-day moving average (MA) of 28.12, above the 50-day MA of 28.75, and below the 200-day MA of 31.27, indicating a neutral trend. The MACD of 0.27 indicates Negative momentum. The RSI at 61.35 is Neutral, neither overbought nor oversold. The STOCH value of 94.92 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CAJPY.

Canon Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CAJPY	76 Outperform	$28.78B	24.45	5.10%	3.07%	4.53%	-38.56%
STX	76 Outperform	$32.00B	22.22	-109.27%	1.90%	38.86%	337.22%
WDC	72 Outperform	$26.16B	16.38	22.57%	0.13%	2.12%	―
SMCI	71 Outperform	$26.62B	26.91	17.90%	―	47.04%	-17.89%
DELL	71 Outperform	$93.42B	21.94	-179.12%	1.41%	7.68%	27.73%
Sector *	68 Neutral	¥238.13B	15.93	6.62%	2.46%	9.00%	-0.33%
HPQ	65 Neutral	$24.52B	10.06	84.33%	4.38%	2.08%	-12.41%