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HENSOLDT AG (DE:HAG)
XETRA:HAG
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HENSOLDT AG
(XETRA:HAG)
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Rating:64Neutral
Price Target:
€95.00
▼(-16.52% Downside)
HENSOLDT AG's overall score reflects strong financial performance and positive earnings call sentiment, offset by high valuation concerns and mixed technical indicators. The company's strategic positioning and robust order intake are significant strengths, while high leverage and valuation pose risks.
Positive Factors
Strong Order Backlog
A robust order backlog provides excellent visibility for future growth, ensuring sustained revenue streams and strategic stability in the defense market.
Strategic Positioning
Strategic alignment with defense spending trends enhances Hensoldt's market position, securing long-term contracts and supporting revenue growth.
Cash Flow Generation
Strong cash flow generation supports financial health, enabling strategic investments and debt management, crucial for long-term sustainability.
Negative Factors
High Leverage
High leverage poses financial risks, potentially straining cash flow and limiting flexibility, which could impact the company's long-term stability.
Profit Margin Decline
Declining profit margins may affect profitability, necessitating efficiency improvements to maintain competitive advantage and financial health.
Free Cash Flow Decline
Negative free cash flow indicates cash management challenges, potentially affecting the ability to fund operations and strategic initiatives.
HENSOLDT AG (HAG) vs. iShares MSCI Germany ETF (EWG)
Market Cap
€13.05B
Dividend Yield0.44%
Average Volume (3M)677.58K
Price to Earnings (P/E)135.7
Beta (1Y)1.02
Revenue Growth18.53%
EPS Growth73.20%
CountryDE
Employees8,986
SectorIndustrials
Sector Strength72
IndustryAerospace & Defense
Share Statistics
EPS (TTM)-0.10
Shares Outstanding115,500,000
10 Day Avg. Volume590,155
30 Day Avg. Volume677,577
Financial Highlights & Ratios
PEG Ratio0.45
Price to Book (P/B)4.59
Price to Sales (P/S)1.79
P/FCF Ratio35.73
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
€91.25Price Target Upside-19.82% Downside
Rating ConsensusHold
Number of Analyst Covering8
HENSOLDT AG Business Overview & Revenue Model
Company DescriptionHENSOLDT AG (HAG) is a leading European defense technology company specializing in sensor solutions for defense and security applications. The company operates in various sectors, including radar, electronic warfare, avionics, and optronics. HENSOLDT provides advanced sensor technologies and integrated solutions to enhance situational awareness and protection for military and civilian customers worldwide.
How the Company Makes MoneyHENSOLDT AG generates revenue primarily through the sale of its highly specialized sensor technologies and integrated solutions to defense and security clients. Key revenue streams include contracts with government defense departments for products such as radar systems, electronic warfare equipment, and avionics solutions. Additionally, HENSOLDT engages in partnerships with other defense companies and leverages its research and development capabilities to innovate and expand its product offerings, contributing to its earnings. The company's revenue is also supported by maintenance, repair, and upgrade services for its products, ensuring ongoing customer engagement and recurring income.
HENSOLDT AG Earnings Call Summary
Earnings Call Date:Jul 31, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 07, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong order intake, revenue growth, and strategic positioning in the defense market, supported by successful refinancing and advancements in software-defined defense. However, challenges in logistics ramp-up, Optronics South Africa, and free cash flow decline were noted.Q2-2025 Updates
Positive Updates
Strong Order Intake and Backlog
Order intake in H1 2025 reached EUR 1.5 billion, with a record order backlog exceeding EUR 7 billion, providing excellent visibility for future growth.
Revenue Growth
Group revenue increased by 11% to EUR 944 million, driven by strong momentum in the Optronics business, with core revenue growing by 14% excluding pass-through.
Strategic Positioning
Hensoldt is well-positioned to benefit from increased German defense spending and European procurement programs, with significant anticipated orders for platforms like the Eurofighter and the Leopard 2 tank.
Pioneering Software-Defined Defense
The appointment of Sven Heursch as Head of Software-Defined Defense and Digitalization is expected to accelerate progress in this strategic area.
Successful Refinancing
Hensoldt successfully issued a EUR 300 million promissory note loan, strengthening its capital structure and financial flexibility.
Negative Updates
Logistics Center Ramp-up Impact
The ramp-up of the new logistics center led to temporary lower productivity within the Sensors segment, impacting the adjusted EBITDA margin.
Optronics South Africa Challenges
While the German entity in Optronics performed strongly, the South African entity faced ongoing technology changes and strategic realignment challenges, impacting revenue development.
Free Cash Flow Decline
Adjusted free cash flow was negative EUR 181 million, driven by investments in working capital to support planned business volume in the second half of the year.
Company Guidance
During the Hensoldt AG H1 2025 Analyst Conference Call, the company reaffirmed its fiscal year 2025 guidance, emphasizing strong order intake and solid financial performance. The order intake for H1 2025 reached EUR 1.4 billion, with a robust order backlog of over EUR 7 billion, indicating excellent visibility for future growth. Group revenue increased by 11% to EUR 944 million, driven by sustained momentum in the Optronics segment. The company anticipates a revenue range of EUR 2.5 billion to EUR 2.6 billion for 2025, with an expected adjusted EBITDA margin of around 18%. Adjusted EBITDA for H1 2025 was EUR 107 million, reflecting a margin of 11.3%. Despite a temporary lower productivity due to logistics ramp-up, Hensoldt expects improvements as the year progresses. Additionally, the company highlighted strategic investments in its logistics center and the Oberkochen site, which are expected to enhance long-term competitiveness and operational efficiency. Adjusted free cash flow stood at minus EUR 181 million, influenced by investments in working capital. The company maintains a disciplined deleveraging path, targeting a leverage of around 1.5x and a dividend payout ratio of 30% to 40% of adjusted net income.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.75
Positive
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.65
Positive
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.70
Positive
| 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
Positive
113.80
Price Trends
93.18
Positive
93.98
Positive
73.54
Positive
Market Momentum
5.42
Negative
70.73
Negative
86.71
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:HAG, the sentiment is Positive. The current price of 113.8 is above the 20-day moving average (MA) of 99.87, above the 50-day MA of 93.18, and above the 200-day MA of 73.54, indicating a bullish trend. The MACD of 5.42 indicates Negative momentum. The RSI at 70.73 is Negative, neither overbought nor oversold. The STOCH value of 86.71 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:HAG.
HENSOLDT AG Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | €1.07B | 13.83 | 8.08% | 2.07% | -2.59% | -3.21% | |
66 Neutral | €20.93B | 24.56 | 18.82% | 0.56% | 45.24% | ― | |
66 Neutral | €91.12B | 105.69 | 18.45% | 0.41% | 31.24% | 52.48% | |
64 Neutral | €13.05B | 135.68 | 11.52% | 0.44% | 18.53% | 73.20% | |
64 Neutral | €8.83B | 114.88 | 18.78% | 0.47% | 21.91% | 125.93% | |
55 Neutral | €2.40B | 416.25 | 1.46% | 0.34% | 1.67% | -91.60% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
DE:HAG
HENSOLDT AG
113.80
83.74
278.58%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.