HENSOLDT AG (HAG) AI Stock Analysis

• Market Cap: €10.49B
• Dividend Yield: 0.52%
• Average Volume (3M): 536.28K
• Price to Earnings (P/E): 115.3
• Beta (1Y): 1.12
• Revenue Growth: 18.53%
• EPS Growth: 73.20%
• Country: DE
• Employees: 8,986
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): -0.10
• Shares Outstanding: 115,500,000
• 10 Day Avg. Volume: 473,044
• 30 Day Avg. Volume: 536,278
• PEG Ratio: 0.45
• Price to Book (P/B): 4.59
• Price to Sales (P/S): 1.79
• P/FCF Ratio: 35.73
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €95.86
• Price Target Upside: 0.06% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 7

• Rating: 65 Neutral
• Price Target: €103.00 ▲(7.52% Upside)

HENSOLDT AG's overall score reflects strong financial performance and strategic positioning in the defense market, offset by high valuation concerns and technical indicators suggesting bearish momentum. The earnings call provided positive guidance, but challenges in logistics and cash flow management remain.

Positive Factors

Strong Order Backlog

A substantial order backlog provides excellent visibility for future growth, ensuring steady revenue streams and reinforcing market position.

Strategic Positioning

Strategic positioning in defense markets enhances long-term growth prospects, driven by increased defense budgets and procurement programs.

Pioneering Software-Defined Defense

Leadership in software-defined defense could drive innovation and competitive advantage, aligning with digital transformation trends in defense.

Negative Factors

High Leverage

High leverage poses financial risks, potentially limiting flexibility and increasing vulnerability to interest rate changes.

Free Cash Flow Decline

Negative free cash flow indicates cash management challenges, which could impact the ability to fund operations and growth initiatives.

Profitability Margin Decline

Declining profitability margins may affect long-term financial health, necessitating efficiency improvements to sustain competitiveness.

HENSOLDT AG Business Overview & Revenue Model

Company Description

HENSOLDT AG (HAG) is a leading global provider of sensors and sensor solutions for defense and security applications. The company specializes in areas such as radar systems, electronic warfare, optronics, and avionics, serving both military and civilian sectors. HENSOLDT's core products include advanced radar systems, airborne sensors, and intelligence solutions designed to enhance situational awareness and operational effectiveness for armed forces and security agencies worldwide.

How the Company Makes Money

HENSOLDT AG generates revenue primarily through the development and sale of advanced sensor technologies and systems to governments and defense contractors. The company's revenue model is predominantly based on long-term contracts with national defense ministries and international defense organizations, which provide a steady stream of income. Key revenue streams include the sale of military radar systems, electronic warfare solutions, and related services such as maintenance and upgrades. Additionally, HENSOLDT benefits from strategic partnerships with other defense corporations and participation in defense procurement programs, which further enhance its market presence and earnings potential. The company also invests in research and development to innovate and expand its product offerings, ensuring continued growth in a competitive market.

HENSOLDT AG Financial Statement Overview

Summary

HENSOLDT AG demonstrates strong financial health with robust revenue growth, effective cost management, and operational efficiency. Despite high leverage, the company maintains a solid return on equity. However, the decline in free cash flow growth is a potential concern.

Income Statement

HENSOLDT AG has demonstrated strong revenue growth over the past years, with a notable TTM revenue growth rate of approximately 2.90% and a significant increase from 2023. The company maintains healthy gross and net profit margins at 21.89% and 4.03% respectively in the TTM period, indicating effective cost management and profitability. EBITDA margin remains robust at 15.87%, showcasing operational efficiency. However, EBIT margin has slightly decreased from 8.26% in 2024 to 7.59% in the TTM, suggesting a need for closer monitoring of operating expenses.

Balance Sheet

The balance sheet reveals a solid equity position with an equity ratio of 18.89% in the TTM. The debt-to-equity ratio is relatively high at 1.69, indicating leverage that could pose a risk if interest rates rise or cash flows decrease. However, the return on equity remains strong at 10.33%, reflecting efficient use of shareholders' capital. The company shows a consistent ability to maintain its asset base and equity levels, which is crucial for long-term stability.

Cash Flow

HENSOLDT AG exhibits a dependable cash flow position with an operating cash flow to net income ratio of 3.15 in the TTM, suggesting strong cash conversion from profits. Free cash flow has decreased in the TTM period, leading to a negative free cash flow growth rate of -23.21%, which could be a concern if the trend continues. Nonetheless, the free cash flow to net income ratio of 0.92 indicates that the company is still generating sufficient cash relative to its net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.34B	2.24B	1.85B	1.71B	1.47B	1.21B
Gross Profit	503.00M	509.00M	416.00M	394.00M	329.80M	270.80M
EBITDA	356.00M	379.00M	293.00M	267.00M	249.00M	156.60M
Net Income	91.00M	108.00M	54.00M	78.00M	63.00M	-64.50M
Balance Sheet
Total Assets	4.65B	4.70B	3.84B	2.98B	2.95B	2.95B
Cash, Cash Equivalents and Short-Term Investments	326.00M	734.00M	803.00M	462.00M	534.00M	657.80M
Total Debt	1.44B	1.38B	854.00M	789.00M	943.90M	1.12B
Total Liabilities	3.80B	3.81B	3.02B	2.36B	2.54B	2.60B
Stockholders Equity	836.00M	872.00M	808.00M	604.00M	399.30M	333.90M
Cash Flow
Free Cash Flow	111.00M	112.00M	153.00M	149.00M	197.20M	99.50M
Operating Cash Flow	317.00M	311.00M	267.00M	244.00M	299.20M	196.90M
Investing Cash Flow	-232.00M	-745.00M	-122.00M	-101.00M	-117.10M	-95.00M
Financing Cash Flow	-159.00M	367.00M	197.00M	-214.00M	-297.20M	411.00M

HENSOLDT AG Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 95.80
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:HAG, the sentiment is Negative. The current price of 95.8 is below the 20-day moving average (MA) of 103.57, below the 50-day MA of 96.93, and above the 200-day MA of 78.88, indicating a neutral trend. The MACD of -1.01 indicates Positive momentum. The RSI at 43.99 is Neutral, neither overbought nor oversold. The STOCH value of 43.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DE:HAG.

HENSOLDT AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MTX	―	€20.93B	24.56	24.74%	0.58%	45.24%	―
JEN	―	€1.16B	14.94	7.86%	1.88%	-2.59%	-3.21%
HAG	―	€10.49B	115.31	11.52%	0.52%	18.53%	73.20%
Sector *	―	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
OHB	―	€2.25B	389.72	1.42%	0.55%	1.67%	-91.60%
RHM	―	€80.93B	93.87	21.91%	0.47%	31.24%	52.48%
R3NK	―	€6.27B	81.59	19.17%	0.63%	21.91%	125.93%

HENSOLDT AG Corporate Events

HENSOLDT AG Reports Strong Growth Amid Challenges

The recent earnings call for HENSOLDT AG painted a picture of robust growth and strategic challenges. The sentiment was generally positive, with strong order intake and revenue growth taking center stage. However, the company also faced some hurdles, including temporary productivity issues in the Sensors segment and strategic challenges within its South African entity, alongside a negative free cash flow.