HENSOLDT AG (HAG) AI Stock Analysis

• Market Cap: €8.59B
• Dividend Yield: 0.68%
• Average Volume (3M): 536.28K
• Price to Earnings (P/E): 69.3
• Beta (1Y): 1.49
• Revenue Growth: 14.89%
• EPS Growth: 619.09%
• Country: DE
• Employees: 8,986
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): 1.03
• 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: €88.50
• Price Target Upside: 18.95% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9
• EPS Forecast (FY): 1.85
• Revenue Forecast (FY): €2.77B

• Rating: 68 Neutral
• Price Target: €91.00 ▲(22.31% Upside)
• Action: Reiterated Date: 12/19/25
• Date: Action: Reiterated 12/19/25

HENSOLDT AG's overall stock score is driven by strong earnings call results and solid financial performance, despite high leverage and valuation concerns. The company's robust order backlog and positive future growth expectations are significant strengths, while technical indicators and valuation metrics suggest caution.

Positive Factors

Record Order Backlog

A EUR 7.1bn backlog provides multi-year revenue visibility and smoothing of project timing risk. It underpins forward production planning, supports aftermarket and sustainment streams, and strengthens negotiating leverage with primes—bolstering durable top-line resilience.

Strong Free Cash Flow Growth

Material FCF growth indicates robust cash conversion ability, giving management flexibility to fund capex, capacity expansion and debt reduction without persistent external financing. Durable cash generation supports strategic investments and balance sheet repair over the medium term.

Capacity Investment to Capture Demand

Targeted EUR80m capacity investment shows proactive scaling for anticipated demand from major programs. Building production capability ahead of ramp improves delivery certainty, preserves market share in high-barrier defense markets and can raise long-term operating leverage once volumes materialize.

Negative Factors

High Leverage

Significant leverage raises refinancing and interest-rate sensitivity, constraining strategic flexibility. Elevated debt levels limit ability to pursue M&A or absorb program delays, and make meeting net-leverage targets dependent on sustained cash generation and disciplined capex over the coming quarters.

Thin and Declining Profitability

Low and slipping net margins reduce the cushion against cost inflation, program execution issues, or contract price pressure. With modest EBITDA conversion and margin erosion, the company faces a structural challenge converting revenue growth into durable earnings power and free cash flow.

Working Capital Strain Dampening FCF

Substantial working-capital build tied to logistics and ramp-up has produced negative adjusted FCF in the first 9 months, pressuring near-term liquidity. Even with TTM FCF gains, timing of cash recovery is uncertain and could delay deleveraging and reinvestment plans.

HENSOLDT AG Business Overview & Revenue Model

Company Description

Hensoldt AG, together with its subsidiaries, provides defense and security electronic sensor solutions worldwide. It offers air surveillance, airborne, ground based, security, naval and coastal, and space radars; identification friend or foe and secure data links; and commercial shipping solutions. The company also provides airborne, vehicle, surveillance, and maritime optronics; space optics; optronic sensor devices; and sights, scopes, and night-vision attachments. In addition, it offers electronic support/SIGINT products, receivers, direction finders, electronic attackers/jammers, self-protection EW software suites and ground support stations, and electronic warfare systems. Further, the company provides avionics, including airborne computing, flight and mission data recording and management, connectivity, mission management/pilot assistance, video management, unmanned, mission planning support, data analysis and evaluation, and cloud solutions, as well as integrated airborne solutions; and counter UAV solutions, and command and control software products. Additionally, it offers products and system support, simulation, and training services; and antenna, cabling, shelter, and tester solutions. The company is headquartered in Taufkirchen, Germany.

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 shows solid financial performance with consistent revenue growth and strong cash flow generation. However, challenges with profitability margins and high leverage pose risks to future financial stability. Continued focus on cost management and debt reduction is crucial.

Income Statement

HENSOLDT AG's income statement shows a positive trajectory with consistent revenue growth, highlighted by a 2.74% increase in TTM. Gross profit margin is stable at 21.53%, though slightly lower than the previous year. Net profit margin has decreased to 3.90% in TTM, indicating some pressure on profitability. EBIT and EBITDA margins have also seen a slight decline, suggesting potential cost pressures or increased competition.

Balance Sheet

The balance sheet reflects a high debt-to-equity ratio of 1.72 in TTM, indicating significant leverage, which could pose risks if not managed carefully. Return on equity is moderate at 10.97%, showing efficient use of equity but with room for improvement. The equity ratio stands at 16.95%, suggesting a reliance on debt financing.

Cash Flow

Cash flow analysis reveals strong free cash flow growth of 72.97% in TTM, indicating robust cash generation capabilities. The operating cash flow to net income ratio is healthy at 0.156, and free cash flow to net income ratio is 0.35, reflecting efficient cash conversion. These metrics highlight the company's solid cash flow position, supporting its operational and financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.40B	2.24B	1.85B	1.71B	1.47B	1.21B
Gross Profit	515.00M	509.00M	416.00M	394.00M	329.80M	270.80M
EBITDA	388.00M	379.00M	293.00M	267.00M	253.00M	156.60M
Net Income	124.00M	108.00M	54.00M	78.00M	63.00M	-64.50M
Balance Sheet
Total Assets	4.97B	4.70B	3.84B	2.98B	2.95B	2.95B
Cash, Cash Equivalents and Short-Term Investments	532.00M	734.00M	803.00M	462.00M	534.00M	657.80M
Total Debt	1.59B	1.38B	854.00M	789.00M	943.90M	1.12B
Total Liabilities	4.12B	3.81B	3.02B	2.36B	2.54B	2.60B
Stockholders Equity	843.00M	872.00M	808.00M	604.00M	399.30M	333.90M
Cash Flow
Free Cash Flow	192.00M	112.00M	153.00M	149.00M	197.20M	99.50M
Operating Cash Flow	394.00M	311.00M	267.00M	244.00M	299.20M	196.90M
Investing Cash Flow	-231.00M	-745.00M	-122.00M	-101.00M	-117.10M	-95.00M
Financing Cash Flow	-26.00M	367.00M	197.00M	-214.00M	-297.20M	411.00M

HENSOLDT AG Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 74.40
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• 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 74.4 is below the 20-day moving average (MA) of 79.78, below the 50-day MA of 81.65, and below the 200-day MA of 88.99, indicating a bearish trend. The MACD of -1.20 indicates Positive momentum. The RSI at 36.47 is Neutral, neither overbought nor oversold. The STOCH value of 31.18 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
JEN	76 Outperform	€1.61B	22.18	7.17%	1.97%	-5.27%	-13.70%
MTX	76 Outperform	€19.68B	19.33	24.74%	0.62%	45.24%	―
HAG	68 Neutral	€8.59B	69.30	15.96%	0.68%	14.89%	619.09%
RHM	63 Neutral	€77.18B	87.57	21.48%	0.53%	24.61%	45.20%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
OHB	63 Neutral	€4.17B	679.55	1.49%	0.51%	10.80%	-91.79%
R3NK	55 Neutral	€5.69B	56.12	24.75%	0.80%	22.71%	396.57%