Hitachi (HTHIY) AI Stock Analysis

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Hitachi

(OTC:HTHIY)

Rating:73Outperform

Price Target:

$30.00

▲(2.56%Upside)

Hitachi's strong financial performance and strategic growth plans are the primary drivers of its stock score. While technical analysis and valuation present some concerns, the company's robust financials and positive earnings call outlook support a favorable score.

Hitachi (HTHIY) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$133.34B

Dividend Yield0.74%

Average Volume (3M)13.58K

Price to Earnings (P/E)33.3

Beta (1Y)1.26

Revenue Growth-4.62%

EPS Growth0.68%

CountryUS

Employees268,655

SectorIndustrials

Sector Strength90

IndustryConglomerates

Share Statistics

EPS (TTM)0.28

Shares Outstanding4,581,561,000

10 Day Avg. Volume0

30 Day Avg. Volume13,579

Financial Highlights & Ratios

PEG Ratio4.27

Price to Book (P/B)3.28

Price to Sales (P/S)0.00

P/FCF Ratio20.69

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusModerate Buy

Number of Analyst Covering0

Hitachi Business Overview & Revenue Model

Company DescriptionHitachi, Ltd. (HTHIY) is a Japanese multinational conglomerate headquartered in Tokyo, Japan. The company operates across multiple sectors, including IT services, social infrastructure, high functional materials & components, automotive systems, digital solutions, and more. Hitachi is known for its wide range of products and services, which include power systems, construction machinery, electronic systems, and equipment, as well as digital and cybersecurity solutions. The company's diversified portfolio enables it to serve various industries such as energy, transportation, healthcare, and telecommunications.

How the Company Makes MoneyHitachi generates revenue through multiple streams, primarily driven by its diverse range of business sectors. The company earns income from the sale of products and services in information technology and social infrastructure systems, which includes IT consultancy, system integration, and maintenance services. Hitachi also makes money through its energy solutions, offering power systems and services for electric utilities. The construction machinery sector, which provides equipment for construction and mining, is another significant revenue stream. Furthermore, Hitachi's automotive systems business, which supplies components to car manufacturers, contributes to its earnings. Strategic partnerships and collaborations across various industries enhance its market reach and profitability. Additionally, the digital solutions and services sector, focusing on IoT, big data analytics, and AI applications, plays a crucial role in Hitachi's financial performance.

Hitachi Earnings Call Summary

Earnings Call Date:Apr 28, 2025

(Q4-2024)

% Change Since: 12.50%|

Next Earnings Date:Jul 31, 2025

Earnings Call Sentiment Neutral

The earnings call presented a balanced outlook with strong financial performance and strategic growth plans through Inspire 2027, but also highlighted significant challenges such as profitability gaps, the impact of U.S. tariffs, and a decline in the Chinese market.

Q4-2024 Updates

Positive Updates

Inspire 2027 Management Plan

Hitachi announced the Inspire 2027 management plan, focusing on cash flow strengthening, capital allocation, and portfolio transformation. Targets include Lumada business representing 80% of revenues and an EBITA margin over 20%.

Record Financial Performance

FY 2024 achieved record-high KPIs, with a revenue increase of 14% year-on-year and adjusted EBITA exceeding JPY 1.1 trillion, marking an improvement to an 11.7% margin.

Lumada Business Growth

Lumada revenues are expected to grow by 30% from FY 2024 to 2025, with a 1 percentage point increase in EBITA margin. Long-term goals aim for a Lumada revenue ratio of over 50% and EBITA margin over 18%.

Dividend and Share Buyback

A dividend increase and a JPY 300 billion share buyback were announced, reflecting a commitment to shareholder returns.

Strong Demand in Energy and Digital Systems

Continued strong demand in renewable energy projects and digital system services, with projected growth in these sectors despite global uncertainties.

Negative Updates

Challenges in Profitability and Capital Efficiency

Hitachi faces gaps in profitability and capital efficiency compared to global peers, with investments not executed as planned in the 2024 MMP.

Impact of U.S. Tariffs

The U.S. tariffs pose a risk, with an estimated direct impact of JPY 350 billion in the current period, requiring supply chain restructuring and cost adjustments.

Decline in Chinese Market

A projected 2% decrease in overall revenue for Connective Industries due to a decline in the Chinese real estate market, impacting building systems.

Company Guidance

During the call, Hitachi outlined its new management plan, Inspire 2027, focusing on key financial metrics and growth strategies. The plan aims to achieve a Lumada business revenue ratio of over 50% and an adjusted EBITA margin of over 18% by 2027, with a long-term goal of Lumada representing 80% of total revenues and achieving an EBITA margin of over 20%. The company targets revenue growth of 7% to 9% and an adjusted EBITA margin of 13% to 15%, while maintaining a cash flow conversion rate of over 90% and aiming for a ROIC between 12% and 13%. Strategic investments, particularly in the Lumada business and digital transformation, are emphasized to drive growth, alongside initiatives to enhance cash flow and optimize capital allocation. The company also plans a share buyback totaling JPY300 billion, indicating a commitment to return value to shareholders.

Hitachi Financial Statement Overview

Summary

Hitachi demonstrates strong financial health with consistent revenue growth, efficient operations, and a robust balance sheet. The company has a solid cash flow position, providing a buffer for investments and obligations.

Income Statement

Very Positive

Hitachi has demonstrated solid revenue growth over the years with a positive trajectory, notably improving its gross profit and net profit margins. The EBIT and EBITDA margins also show strong operational efficiency. The company has maintained consistent revenue growth, indicating strong market demand and operational execution.

Balance Sheet

Positive

Hitachi maintains a robust balance sheet with a healthy equity ratio, indicating financial stability. The debt-to-equity ratio is reasonable, suggesting manageable leverage. Overall, the company's financial position is strong, thanks to its substantial equity base, though some fluctuations in total debt levels should be monitored.

Cash Flow

Very Positive

The cash flow statement reveals a steady increase in operating cash flow, which indicates efficient cash management. Free cash flow has shown significant growth, improving the company's liquidity position. The ratio of operating cash flow to net income is robust, reflecting strong cash generation relative to earnings.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	9.78T	9.73T	10.88T	10.26T	8.73T
Gross Profit	2.82T	2.58T	2.69T	2.56T	2.20T
EBITDA	1.44T	1.35T	1.47T	1.28T	986.84B
Net Income	615.72B	589.90B	649.12B	583.47B	501.61B
Balance Sheet
Total Assets	13.28T	12.22T	12.50T	13.89T	11.85T
Cash, Cash Equivalents and Short-Term Investments	1.18T	1.04T	833.28B	968.83B	1.02T
Total Debt	1.21T	1.18T	2.21T	3.13T	2.40T
Total Liabilities	7.25T	6.36T	7.17T	8.53T	7.39T
Stockholders Equity	5.85T	5.70T	4.94T	4.34T	3.53T
Cash Flow
Free Cash Flow	780.59B	571.47B	416.46B	290.08B	420.18B
Operating Cash Flow	1.17T	956.61B	827.04B	729.94B	793.13B
Investing Cash Flow	-573.65B	-131.54B	-123.31B	-1.07T	-999.44B
Financing Cash Flow	-424.12B	-1.02T	-868.59B	224.75B	355.76B

Hitachi Technical Analysis

Technical Analysis Sentiment

Positive

Last Price29.25

Price Trends

50DMA

27.62

Positive

100DMA

25.97

Positive

200DMA

25.87

Positive

Market Momentum

MACD

0.25

Negative

RSI

60.58

Neutral

STOCH

100.06

Negative

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 29.25 is above the 20-day moving average (MA) of 28.18, above the 50-day MA of 27.62, and above the 200-day MA of 25.87, indicating a bullish trend. The MACD of 0.25 indicates Negative momentum. The RSI at 60.58 is Neutral, neither overbought nor oversold. The STOCH value of 100.06 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HTHIY.

Hitachi Peers Comparison

Overall Rating

UnderperformOutperform

Sector (65)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HON	80 Outperform	$152.02B	27.17	33.56%	1.91%	6.30%	0.81%
HTHIY	73 Outperform	$133.34B	33.31	10.50%	0.74%	-4.62%	0.68%
Sector *	65 Neutral	$10.94B	15.63	5.18%	1.91%	3.14%	-27.13%
MMM	56 Neutral	$82.47B	21.31	96.00%	1.91%	-19.56%	325.26%

* Industrials Sector Average

Performance Comparison

HTHIY

Hitachi

29.25

7.23

32.83%

MMM

153.23

50.39

49.00%

HON

Honeywell International

236.54

24.04

11.31%

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.Date of analysis: Jul 08, 2025