Sumitomo Heavy Industries (6302) AI Stock Analysis

• Market Cap: $415.53B
• Dividend Yield: 3.69%
• Average Volume (3M): 478.33K
• Price to Earnings (P/E): 709.4
• Beta (1Y): 1.07
• Revenue Growth: -4.25%
• EPS Growth: -110.18%
• Country: JP
• Employees: 25,337
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 49.13
• Shares Outstanding: 122,905,480
• 10 Day Avg. Volume: 436,150
• 30 Day Avg. Volume: 478,326
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.16
• Enterprise Value/Revenue: 0.46
• Enterprise Value/Gross Profit: 1.91
• Enterprise Value/Ebitda: 6.31
• 1Y Price Target: $3,371.56
• Price Target Upside: -0.60% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 57 Neutral
• Price Target: ¥3,396.00 ▲(0.12% Upside)

The stock's overall score is primarily affected by its high P/E ratio indicating overvaluation despite a strong dividend yield. Financial performance is stable but challenged by low profitability and cash flow issues. Technical analysis signals short-term bullish momentum, though caution is advised due to potential overbought conditions.

Sumitomo Heavy Industries Business Overview & Revenue Model

Company Description

Sumitomo Heavy Industries, Ltd. manufactures and sells general machinery, advanced precision machinery, construction machinery, ships, and environmental plant facilities in Japan and internationally. The company operates through four segments: Mechatronics, Industrial Machinery, Logistics & Construction, and Energy & Lifelines. Its Mechatronics segment offers gear reducers, motors, and boxes; motion control drives, inverters, precision positioning equipment, laser processing systems, control systems and components, motion components, and drive and collaborative robot solutions. The company's Industrial Machinery segment provides plastics machinery, film forming machines, cryogenic equipment, precision forgings, semiconductor production equipment, medical machines and equipment, forging press machines, machining tools, air conditioning equipment, defense equipment, injection molding machines, transfer molding presses, cryocoolers, cryopumps, ion accelerators and implanters, cyclotrons, tracer production systems, proton therapy systems, vacuum coating equipment, steel tube air forming systems, lifting magnets, spinning machines, clean room systems, dust collectors, cast iron and steel rolls, surface grinding machines, coolant systems, and extrusion coating products. Its Logistics & Construction segment offers hydraulic excavators, mobile cranes, road machinery, material handling systems, logistics systems, automated parking systems, road machinery, crawler cranes, foundation machines, and forklifts. The company's Energy & Lifelines segment provides private power generation facilities, boilers, air pollution control equipment, water and sewage treatment systems, industrial waste treatment facilities, turbines, pumps, process equipment, pressure vessels, mixing vessels, food processing machinery, ships, circulating and bubbling fluidized bed boilers, liquid air energy storage, rotary kiln-type recycling facilities, electrostatic precipitators, ash handling systems, evaporation and crystallization facilities, fluidized bed gasifiers, waste heat boilers, waste-to-energy plants, CFB scrubbers, baghouses, flue gas denitrification systems, plant operation support systems, industrial waste water treatment facilities, water and sewage treatment systems, steam turbines, process pumps, distillation technology and extractors, reactor vessels, mixing vessels, coke oven machines, food and beverage manufacturing facilities, and oil tankers. The company was founded in 1888 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Sumitomo Heavy Industries generates revenue through the sale of its diverse range of machinery and equipment, which includes industrial and construction machinery, precision machinery, and ships. The company also earns from providing engineering and maintenance services across its various sectors. Key revenue streams include the sale of construction machinery such as excavators and cranes, as well as industrial solutions like pumps and compressors. Additionally, the company's precision machinery division, which produces components for semiconductor and medical equipment, contributes significantly to its earnings. Sumitomo Heavy Industries also benefits from strategic partnerships and contracts with both public and private sector clients, enhancing its market presence and financial performance.

Sumitomo Heavy Industries Financial Statement Overview

Summary

Sumitomo Heavy Industries shows financial stability with a strong equity position, but struggles with profitability and cash flow management as indicated by declining income margins and negative free cash flow.

Income Statement

The company's revenue has shown slight fluctuations, with recent revenue slightly declining from the previous year. Gross profit margin is stable at approximately 24%. However, net profit margin has significantly decreased from 3% to 0.7% due to reduced net income. EBIT and EBITDA margins have also decreased, indicating potential challenges in maintaining operational efficiency.

Balance Sheet

The balance sheet reveals a strong equity position, with a consistent equity ratio above 50%, highlighting financial stability. The debt-to-equity ratio has increased recently, indicating higher leverage, which could pose a risk if not managed carefully. Nevertheless, the return on equity remains moderate at around 1.2%.

Cash Flow

The company's free cash flow has turned negative, reflecting higher capital expenditures and a decline in operating cash flow. The operating cash flow to net income ratio remains robust, suggesting good cash generation relative to net earnings. However, the negative free cash flow to net income ratio highlights the need for better capital management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.06T	1.07T	1.08T	1.14T	943.98B	849.07B
Gross Profit	252.68B	257.00B	255.25B	251.54B	211.96B	185.45B
EBITDA	76.66B	62.69B	110.74B	102.80B	96.53B	79.17B
Net Income	617.00M	7.72B	32.74B	7.71B	44.05B	26.76B
Balance Sheet
Total Assets	1.25T	1.26T	1.20T	1.15T	1.09T	1.03T
Cash, Cash Equivalents and Short-Term Investments	121.97B	111.13B	104.46B	97.48B	88.78B	99.52B
Total Debt	261.20B	238.62B	162.23B	171.74B	111.25B	124.44B
Total Liabilities	623.56B	613.82B	573.39B	571.95B	528.09B	525.76B
Stockholders Equity	623.54B	640.68B	619.77B	569.26B	551.39B	490.70B
Cash Flow
Free Cash Flow	-24.88B	-34.92B	25.91B	-15.18B	16.04B	24.29B
Operating Cash Flow	13.52B	12.76B	65.37B	21.37B	61.68B	64.13B
Investing Cash Flow	-41.24B	-49.48B	-43.27B	-37.28B	-49.68B	-43.73B
Financing Cash Flow	49.96B	41.91B	-17.21B	21.68B	-28.11B	-7.96B

Sumitomo Heavy Industries Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3392.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6302, the sentiment is Positive. The current price of 3392 is above the 20-day moving average (MA) of 3389.15, above the 50-day MA of 3315.60, and above the 200-day MA of 3072.78, indicating a bullish trend. The MACD of 36.76 indicates Positive momentum. The RSI at 51.73 is Neutral, neither overbought nor oversold. The STOCH value of 23.36 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6302.

Sumitomo Heavy Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6005	73 Outperform	334.97B	13.81	11.42%	2.03%	48.63%	30.73%
6268	70 Outperform	390.75B	31.49	4.59%	2.39%	4.14%	33.45%
6406	66 Neutral	430.35B	30.56	9.32%	2.91%	2.84%	-20.37%
5631	60 Neutral	633.51B	33.84	9.30%	0.89%	9.43%	21.15%
6302	57 Neutral	$415.53B	709.43	-0.47%	3.69%	-4.25%	-110.18%
6481	56 Neutral	455.81B	68.39	2.15%	6.13%	0.85%	-46.23%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Sumitomo Heavy Industries Corporate Events

Sumitomo Heavy Industries Enhances Stock Compensation Plan

Sumitomo Heavy Industries has resolved to continue its stock compensation plan, initially introduced in 2022, for its Directors and Vice Presidents. The company will make an additional trust contribution to acquire more shares, enhancing the plan’s effectiveness and aligning management’s interests with shareholder value.

The most recent analyst rating on (JP:6302) stock is a Hold with a Yen3000.00 price target. To see the full list of analyst forecasts on Sumitomo Heavy Industries stock, see the JP:6302 Stock Forecast page.

Sumitomo Heavy Industries to Dispose Treasury Shares for Stock Compensation Plan

Sumitomo Heavy Industries announced the disposal of 75,700 treasury shares through a third-party allotment as part of its ongoing stock compensation plan. This move aims to align the interests of its directors and vice presidents with the company’s stock value, encouraging them to enhance corporate value over the medium to long term. The disposal is expected to have a minimal dilutive effect on the company’s shares, reflecting a strategic effort to strengthen corporate governance and shareholder value.

The most recent analyst rating on (JP:6302) stock is a Hold with a Yen3000.00 price target. To see the full list of analyst forecasts on Sumitomo Heavy Industries stock, see the JP:6302 Stock Forecast page.

Sumitomo Heavy Industries Reports Decline in First Half 2025 Financial Results

Sumitomo Heavy Industries reported a decline in its financial performance for the first half of 2025, with net sales decreasing by 4.9% and operating profit dropping by 35% compared to the previous year. The company’s ordinary profit and profit attributable to owners also saw significant declines, indicating challenging market conditions and potential impacts on stakeholders.

The most recent analyst rating on (JP:6302) stock is a Hold with a Yen3000.00 price target. To see the full list of analyst forecasts on Sumitomo Heavy Industries stock, see the JP:6302 Stock Forecast page.

Sumitomo Heavy Industries Announces Subsidiary Merger for Strategic Optimization

Sumitomo Heavy Industries announced the merger of its wholly owned subsidiaries, Sumitomo Heavy Industries Himatex Co., Ltd. and Sumitomo Heavy Industries Finetech, Ltd., into its Industrial Equipment Division, effective January 1, 2026. This strategic move aims to streamline operations and enhance the company’s positioning in the metal processing business, reflecting its ongoing efforts to reform its business portfolio and optimize management resources.

The most recent analyst rating on (JP:6302) stock is a Hold with a Yen3000.00 price target. To see the full list of analyst forecasts on Sumitomo Heavy Industries stock, see the JP:6302 Stock Forecast page.