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Hitachi Ltd (HTHIY)
OTHER OTC:HTHIY
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Hitachi
(OTC:HTHIY)
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Rating:62Neutral
Price Target:
$33.00
â–²(6.66% Upside)
Hitachi's overall stock score reflects a mixed financial performance with strong profitability but declining revenue and cash flow. The earnings call provided a positive outlook with growth in key sectors, which offsets some of the financial challenges. However, technical indicators and valuation suggest caution, as the stock appears relatively expensive with limited momentum.
Positive Factors
Revenue Growth
The significant revenue and EBITA growth in key sectors like DSS and GEM indicates strong market demand and effective business strategies, supporting long-term financial health.
Strategic Partnerships
Strategic partnerships and AI investments enhance Hitachi's technological capabilities and market position, fostering innovation and competitive advantage over the long term.
Balance Sheet Strength
A strong balance sheet with low leverage provides financial stability and flexibility, allowing Hitachi to invest in growth opportunities and withstand economic fluctuations.
Negative Factors
Revenue Decline
A notable revenue decline poses challenges to sustaining growth and profitability, potentially impacting Hitachi's ability to maintain its market position and invest in future initiatives.
Equity Loss in Affiliates
Equity losses in affiliates like Hitachi Astemo can strain overall profitability and highlight vulnerabilities in Hitachi's investment portfolio, affecting long-term financial performance.
Cash Flow Challenges
Declining free cash flow growth may limit Hitachi's ability to fund operations and strategic investments, potentially impacting its capacity to drive future growth and innovation.
Hitachi (HTHIY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$148.56B
Dividend Yield0.77%
Average Volume (3M)29.95K
Price to Earnings (P/E)27.8
Beta (1Y)1.37
Revenue Growth8.28%
EPS Growth21.01%
CountryUS
Employees268,655
SectorIndustrials
Sector Strength72
IndustryConglomerates
Share Statistics
EPS (TTM)0.40
Shares Outstanding4,581,561,000
10 Day Avg. Volume30,860
30 Day Avg. Volume29,948
Financial Highlights & Ratios
PEG Ratio2.40
Price to Book (P/B)1.38
Price to Sales (P/S)0.83
P/FCF Ratio8.74
Enterprise Value/Market Cap59.09
Enterprise Value/Revenue1.67
Enterprise Value/Gross Profit5.71
Enterprise Value/Ebitda11.89
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Hitachi Business Overview & Revenue Model
Company DescriptionHitachi Ltd. is a multinational conglomerate based in Japan, operating across various sectors including information technology, social infrastructure, high functional materials & components, and more. The company is known for its diverse range of products and services, including IT services, cloud computing, power systems, industrial machinery, and consumer electronics. Hitachi aims to contribute to society through its innovative technologies and solutions, focusing on sustainable development and enhancing customer value across its sectors.
How the Company Makes MoneyHitachi generates revenue through multiple key streams, primarily from IT services, social infrastructure projects, and high functional materials. The IT Services segment, which includes system integration and consulting, is a significant contributor, capitalizing on the increasing demand for digital transformation. The social infrastructure sector involves large-scale projects such as transportation systems and energy solutions, where Hitachi partners with governments and private entities, ensuring long-term contracts and steady income. Additionally, the high functional materials & components sector provides advanced materials for various industries, further diversifying revenue sources. Strategic partnerships with leading technology firms enhance their offerings, driving sales and fostering innovation, while a focus on sustainability and smart technology solutions attracts investment and customer interest, boosting overall earnings.
Hitachi Earnings Call Summary
Earnings Call Date:Oct 30, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Feb 04, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook with strong revenue growth and strategic advancements in AI and energy sectors, but challenges remain in the form of equity losses in affiliates and competitive pressures in specific business areas.Q2-2025 Updates
Positive Updates
Revenue and Profit Growth
Hitachi achieved an 11% year-on-year increase in revenue and a 23% increase in adjusted EBITA in Q2 FY 2024, driven by strong performance in DSS and GEM sectors.
Upward Revision in FY 2024 Forecast
Due to strong demand in the GEM sector, Hitachi has revised its revenue forecast upwards by JPY 150 billion and adjusted EBITA by JPY 19.5 billion.
Strong Order Growth in GEM
Orders in the GEM sector increased by 42% year-on-year, with significant contributions from railway BU and Hitachi Energy.
Strategic Partnerships and AI Investments
Hitachi is expanding its strategic partnerships, such as with Singtel, and investing JPY 300 billion in generative AI, focusing on infrastructure development and service engineering.
Increased Interim Dividend
Hitachi announced a 10% increase in dividends, representing a 31% year-on-year increase from the previous year's interim dividend.
Negative Updates
Equity Loss in Hitachi Astemo
Hitachi reported a decline in consolidated EBITA by JPY 22.1 billion year-on-year due to deterioration in equity in profit of affiliates, particularly Hitachi Astemo.
Challenges in Storage Business
The DSS segment's storage business experienced a decline due to intensified competition and a shift in projects, impacting profitability.
Impact of Foreign Exchange and Project Delays
Hitachi Energy's Q2 performance was affected by foreign exchange rates and project delays, resulting in fluctuations in revenue and profitability.
Company Guidance
The guidance provided during Hitachi Limited's Q2 FY 2024 web conference highlighted several key financial metrics. The company reported an 11% year-on-year increase in revenues, driven primarily by growth in the GEM (Green Energy and Mobility) and DSS (Digital Systems and Services) sectors. Adjusted EBITA rose by 23% year-on-year, with the adjusted EBITA margin improving by 1 percentage point to 10.7%. Net income attributable to Hitachi was reported at JPY 116.9 billion. Despite an increase in adjusted EBITA for the three sectors, consolidated EBITA decreased by JPY 22.1 billion due to a deterioration in equity profit from affiliates, notably Hitachi Astemo. Core free cash flow increased to JPY 97.6 billion. The fiscal year 2024 outlook was optimistic, with a revised revenue forecast up by JPY 150 billion and adjusted EBITA up by JPY 19.5 billion. Core free cash flow is expected to reach JPY 1.5 trillion, exceeding the medium-term target by JPY 300 billion. The company is also anticipating a 7% year-on-year increase in revenues and a 23% year-on-year rise in adjusted EBITA for FY 2024, with the adjusted EBITA margin projected to improve by 1.5 percentage points to 11.5%.Hitachi Financial Statement Overview
Summary
Hitachi's financial performance is mixed. Despite a significant revenue decline, the company maintains strong profitability margins and a robust balance sheet with low leverage. However, challenges are evident in cash flow generation, with a notable decline in free cash flow.Income Statement
Hitachi's income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) data indicates a significant decline in revenue growth rate at -30.54%, which is concerning. However, the company maintains stable margins with a gross profit margin of 28.91% and a net profit margin of 6.44%. The EBIT and EBITDA margins are also healthy at 10.27% and 14.65%, respectively. Despite the revenue drop, profitability metrics remain strong, suggesting effective cost management.Balance Sheet
The balance sheet reflects a solid financial position with a low debt-to-equity ratio of 0.24 in the TTM period, indicating low leverage. The return on equity is 10.99%, showing decent profitability relative to equity. The equity ratio stands at 44.06%, suggesting a strong equity base relative to total assets. Overall, the balance sheet demonstrates financial stability and low risk.Cash Flow
Cash flow analysis reveals some challenges, with a negative free cash flow growth rate of -10.68% in the TTM period. However, the operating cash flow to net income ratio is 0.24, and the free cash flow to net income ratio is 0.82, indicating that the company generates sufficient cash flow relative to its net income. While there is a decline in free cash flow, the company maintains a reasonable cash flow position.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2023 | Dec 2023 | Dec 2023 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.27T | 9.78T | 9.73T | 9.73T | 9.73T | 9.73T |
| Gross Profit | 1.54T | 2.82T | 2.58T | 2.58T | 2.58T | 2.58T |
| EBITDA | 738.15B | 1.44T | 1.35T | 1.35T | 1.35T | 1.35T |
| Net Income | 326.68B | 615.72B | 589.90B | 589.90B | 589.90B | 589.90B |
Balance Sheet | ||||||
| Total Assets | 13.89T | 13.28T | 12.22T | 12.22T | 12.22T | 12.22T |
| Cash, Cash Equivalents and Short-Term Investments | 1.61T | 866.24B | 1.04T | 1.04T | 1.04T | 1.04T |
| Total Debt | 1.21T | 1.21T | 1.18T | 1.18T | 1.18T | 1.18T |
| Total Liabilities | 7.60T | 7.25T | 6.36T | 6.36T | 6.36T | 6.36T |
| Stockholders Equity | 6.12T | 5.85T | 5.70T | 5.70T | 5.70T | 5.70T |
Cash Flow | ||||||
| Free Cash Flow | 1.08T | 925.39B | 571.47B | 571.47B | 571.47B | 571.47B |
| Operating Cash Flow | 1.29T | 1.17T | 956.61B | 956.61B | 956.61B | 956.61B |
| Investing Cash Flow | -291.49B | -530.10B | -131.54B | -131.54B | -131.54B | -131.54B |
| Financing Cash Flow | -560.36B | -467.68B | -1.02T | -1.02T | -1.02T | -1.02T |
Hitachi Technical Analysis
Positive
30.94
Price Trends
32.04
Positive
30.01
Positive
28.41
Positive
Market Momentum
0.39
Negative
52.84
Neutral
66.48
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HTHIY, the sentiment is Positive. The current price of 30.94 is below the 20-day moving average (MA) of 31.89, below the 50-day MA of 32.04, and above the 200-day MA of 28.41, indicating a bullish trend. The MACD of 0.39 indicates Negative momentum. The RSI at 52.84 is Neutral, neither overbought nor oversold. The STOCH value of 66.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HTHIY.
Hitachi Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $130.30B | 21.85 | 35.85% | 2.24% | 7.48% | 9.55% | |
71 Outperform | $8.28B | 36.62 | 14.90% | 0.63% | 1.23% | -22.77% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
62 Neutral | $148.56B | 27.75 | 10.93% | 0.77% | 8.28% | 21.01% | |
59 Neutral | $87.78B | 26.41 | 73.38% | 1.82% | -13.09% | -20.63% |
* Industrials Sector Average
HTHIY
Hitachi
32.44
8.25
34.11%
MMM
3M
165.24
33.14
25.09%
HON
Honeywell International
205.24
3.22
1.59%
VMI
Valmont
420.24
115.62
37.96%
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.