HENSOLDT AG Unsponsored ADR (HAGHY) AI Stock Analysis

• Market Cap: $10.92B
• Dividend Yield: 0.52%
• Average Volume (3M): 1.96K
• Price to Earnings (P/E): 39.8
• Beta (1Y): 0.52
• Revenue Growth: 17.21%
• EPS Growth: 643.48%
• Country: US
• Employees: 8,986
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): 0.60
• Shares Outstanding: 1,155,000,000
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 1,958
• PEG Ratio: 0.41
• Price to Book (P/B): 3.43
• Price to Sales (P/S): 1.44
• P/FCF Ratio: 14.34
• Enterprise Value/Market Cap: 0.93
• Enterprise Value/Revenue: 4.17
• Enterprise Value/Gross Profit: 19.53
• Enterprise Value/Ebitda: 26.37
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 58 Neutral
• Price Target: $9.50 ▼(-76.24% Downside)
• Action: Reiterated Date: 03/14/26
• Date: Action: Reiterated 03/14/26

The score is driven primarily by moderate financial quality: improving cash generation is a strength, but leverage is elevated and recent revenue/margins softened. Technicals are weak with the stock below major moving averages and negative MACD. Valuation is a headwind due to a high P/E, while the earnings call provides meaningful support through raised guidance and a record backlog.

Positive Factors

Cash generation

Strong operating cash flow (~€435M) and materially positive free cash flow (~€237M) provide durable financial flexibility. This cash generation supports multi-year program execution, funds R&D and capex without immediate external financing, and cushions the company through procurement timing swings typical in defense contracting.

Record backlog & higher book-to-bill

A record €7.1B backlog and upgraded book-to-bill guidance (1.6–1.9x) provide multi-year revenue visibility and reduce sales volatility. For a defense supplier, a large contracted backlog anchors future revenue, enables production planning, and supports stable aftermarket and service follow-through over several procurement cycles.

Optronics segment momentum

The Optronics business shows scalable, higher-growth dynamics (27% revenue growth, book-to-bill 1.4x) and a targeted EBITDA margin expansion to ~14%. A growing, higher-margin segment strengthens overall margin sustainability, diversifies revenue mix, and improves resilience to program-level cost pressure over the medium term.

Negative Factors

Elevated leverage

Leverage has increased materially (debt-to-equity ~1.65), which raises interest expense sensitivity and reduces financial flexibility. In a capital-intensive defense supplier model, elevated leverage can amplify earnings volatility, limit discretionary investment, and make meeting strategic targets harder if margins or cash flows weaken.

Margin compression

Recent margin compression and a modest revenue decline signal profit pressure. Lower net margins reduce the buffer to absorb input-cost inflation or program overruns, limiting reinvestment and making free cash flow and return targets harder to sustain across defense procurement cycles.

Working-capital and ramp costs

Significant working-capital build (‑€119M in the first nine months) and logistical ramp-up pressures have depressed near-term free cash flow and margins. Persistent WC strain tied to program ramp-up can force higher external funding needs and constrain the company's ability to organically finance growth or reduce leverage over time.

HENSOLDT AG Unsponsored ADR Business Overview & Revenue Model

Company Description

HENSOLDT AG is a German electronics company specializing in sensor solutions for defense and security applications. The company operates primarily in the sectors of defense technology, aerospace, and security. HENSOLDT provides advanced technologies in radar, optronics, electronic warfare, and cyber security. Its core products include airborne and ground-based radar systems, command and control systems, and intelligence, surveillance, and reconnaissance (ISR) solutions.

How the Company Makes Money

HENSOLDT primarily makes money by selling defense and security sensor systems and related services to governmental customers, armed forces, and prime defense contractors. Key revenue streams typically include: (1) Product and system sales: revenue from delivering radar, EO/IR, electronic warfare, avionics, and other sensor/mission systems as part of new platform procurements or upgrades/retrofits on existing aircraft, ships, land vehicles, and ground installations. These contracts are commonly multi-year and tied to procurement programs, with revenue recognized as equipment is delivered and accepted and/or as contract performance obligations are met. (2) Aftermarket and services: recurring revenue from maintenance, repair and overhaul (MRO), spare parts, logistics, training, software/firmware updates, and long-term service/support agreements that sustain systems over their operational life. (3) Program work with primes and consortia: revenue earned as a subsystem supplier and integration partner on large defense programs, where HENSOLDT provides sensor components, subassemblies, or complete sensor suites to prime contractors and may also support qualification, testing, and platform integration. (4) R&D and development contracts: in some cases, income from customer-funded development or co-development activities related to new capabilities, prototypes, or system enhancements. Earnings are influenced by government defense budgets, procurement cycles, export approvals, contract timing and milestone achievement, and the installed base of fielded systems that drives service and spares demand. Specific material partnerships or customer/program concentrations for HAGHY are not available here and are therefore null.

HENSOLDT AG Unsponsored ADR Financial Statement Overview

Summary

Profitability is positive but modest and recently pressured (net margin ~3.6% in 2025 vs ~4.8% in 2024) alongside a slight revenue decline (~-1.7%). Cash generation improved strongly (OCF ~435M; FCF ~237M in 2025), but rising leverage (debt-to-equity ~1.65 in 2025) is a key constraint.

Income Statement

Revenue scaled meaningfully from 2020 to 2024, but 2025 showed a slight decline (about -1.7%), signaling a near-term growth pause. Profitability is positive and generally improving versus the 2020 loss, yet margins remain modest for the sector: 2025 net margin is ~3.6% (down from ~4.8% in 2024) and operating profitability also eased year over year. Overall, the business looks profitable and established, but with recent margin compression and a softer top-line trajectory.

Balance Sheet

The balance sheet shows elevated leverage that has trended up in recent years: debt-to-equity rose from ~1.06 (2023) to ~1.58 (2024) and ~1.65 (2025), alongside higher absolute debt. Equity has grown, but leverage remains a key constraint and can amplify earnings volatility if profitability softens. Returns on equity are positive (about 8.6% in 2025) but down from 2024, reinforcing that recent profit pressure is showing up in shareholder returns.

Cash Flow

Cash generation is a relative strength. Operating cash flow increased to ~435M in 2025 from ~311M in 2024, and free cash flow more than doubled to ~237M with strong growth. Free cash flow has generally been positive across the period, supporting flexibility. The main weakness is that cash flow covers only a modest portion of revenue (roughly 16–24% over time), and free cash flow has been somewhat volatile year to year.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.36B	2.24B	1.85B	1.71B	1.47B
Gross Profit	504.28M	509.00M	416.00M	394.00M	329.80M
EBITDA	369.81M	379.00M	293.00M	267.00M	253.00M
Net Income	85.49M	108.00M	54.00M	78.00M	63.00M
Balance Sheet
Total Assets	5.42B	4.70B	3.84B	2.98B	2.95B
Cash, Cash Equivalents and Short-Term Investments	932.60M	734.00M	803.00M	462.00M	534.00M
Total Debt	1.63B	1.38B	854.00M	789.00M	943.90M
Total Liabilities	4.42B	3.81B	3.02B	2.36B	2.54B
Stockholders Equity	990.58M	872.00M	808.00M	604.00M	399.30M
Cash Flow
Free Cash Flow	237.25M	112.00M	153.00M	149.00M	197.20M
Operating Cash Flow	435.12M	311.00M	267.00M	244.00M	299.20M
Investing Cash Flow	-226.69M	-745.00M	-122.00M	-101.00M	-117.10M
Financing Cash Flow	-19.21M	367.00M	197.00M	-214.00M	-297.20M

HENSOLDT AG Unsponsored ADR Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 39.99
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HAGHY, the sentiment is Negative. The current price of 39.99 is above the 20-day moving average (MA) of 9.17, above the 50-day MA of 9.61, and above the 200-day MA of 10.32, indicating a bearish trend. The MACD of -0.19 indicates Negative momentum. The RSI at 46.29 is Neutral, neither overbought nor oversold. The STOCH value of 73.91 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HAGHY.

HENSOLDT AG Unsponsored ADR Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DRS	76 Outperform	$12.04B	32.53	10.54%	1.04%	12.27%	33.16%
TXT	68 Neutral	$15.99B	17.04	12.25%	0.09%	1.83%	-0.73%
BWXT	64 Neutral	$18.72B	47.98	27.65%	0.56%	14.01%	10.92%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
HAGHY	58 Neutral	$10.92B	39.79	14.37%	0.52%	17.21%	643.48%
AVAV	53 Neutral	$10.58B	-21.68	-6.41%	―	79.89%	-171.81%
KTOS	51 Neutral	$16.72B	606.55	1.20%	―	14.00%	23.78%