Sumitomo Heavy Industries Ltd (JP:6302)
:6302
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Sumitomo Heavy Industries
(6302)
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Rating:54Neutral
Price Target:
¥5,130.00
▲(7.37% Upside)
Action:ReiteratedDate:03/17/26
The score is held back primarily by deteriorating financial quality in 2025 (sharp margin compression and negative free cash flow), reinforced by weak technical momentum (below key moving averages and negative MACD). A modest P/E and a ~2.5% dividend yield provide some valuation support but do not fully offset the recent fundamental and trend pressures.
Positive Factors
Diversified Industrial Portfolio
Sumitomo Heavy’s exposure across industrial machinery, logistics/construction equipment, precision/semiconductor systems and energy-related solutions creates multiple durable revenue streams. Coupled with after-sales service and lifecycle contracts, this diversification lowers cyclicality and supports more stable recurring revenues and customer ties over time.
Negative Factors
Sharp Net Margin Compression
A pronounced drop in net margin materially weakens return on equity and shareholder outcomes. Low net margins leave little buffer for project cost overruns, pricing pressure, or macro shocks, making profitability vulnerable until the company restores better cost control, project execution, or higher-margin product mix.
Read all positive and negative factors
Positive Factors
Negative Factors
Diversified Industrial Portfolio
Sumitomo Heavy’s exposure across industrial machinery, logistics/construction equipment, precision/semiconductor systems and energy-related solutions creates multiple durable revenue streams. Coupled with after-sales service and lifecycle contracts, this diversification lowers cyclicality and supports more stable recurring revenues and customer ties over time.
Read all positive factors
Sumitomo Heavy Industries (6302) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥601.98B
Dividend Yield2.95%
Average Volume (3M)672.00K
Price to Earnings (P/E)11.3
Beta (1Y)1.28
Revenue Growth-2.67%
EPS Growth-85.21%
CountryJP
Employees25,337
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)91.84
Shares Outstanding122,905,480
10 Day Avg. Volume577,350
30 Day Avg. Volume672,000
Financial Highlights & Ratios
PEG Ratio-0.67
Price to Book (P/B)0.61
Price to Sales (P/S)0.37
P/FCF Ratio-11.23
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥5,700.00Price Target Upside19.30% Upside
Rating ConsensusHold
Number of Analyst Covering3
EPS Forecast (FY)277.25
Revenue Forecast (FY)¥1.09T
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: Mec...
How the Company Makes Money
Sumitomo Heavy Industries makes money primarily by selling industrial machinery, systems, and components to corporate and public-sector customers, and by providing associated engineering and lifecycle services. Key revenue streams typically includ...
Sumitomo Heavy Industries Earnings Call Summary
Earnings Call Date:Aug 07, 2024
(Q2-2024)
| % Change Since: |
Next Earnings Date:May 08, 2026
Earnings Call Sentiment Neutral
The earnings call reflects a mixed performance with positive outcomes in net sales and operating profit due to favorable exchange rates and certain segment successes. However, significant challenges remain in terms of decreased orders in key segments, negative cash flow, and slow recovery in critical markets such as semiconductors and energy. The progress on the Medium-Term Management Plan 2026 offers a strategic outlook for future growth.Positive Updates
Overall Increase in Net Sales
Despite challenges, net sales increased overall due to foreign exchange gains and backlog orders in various segments.
Negative Updates
Decreased Orders and Sales in Key Segments
Orders and sales decreased in Mechatronics and Industrial Machinery due to inventory adjustments and lower demand in the semiconductor sector.
Read all updates
Q2-2024 Updates
Positive
Negative
Overall Increase in Net Sales
Despite challenges, net sales increased overall due to foreign exchange gains and backlog orders in various segments.
Read all positive updates
Company Guidance
During the Q2 2024 earnings call, Shinji Shimomura, the company president, provided comprehensive guidance on multiple financial metrics and strategic initiatives. The company reported receiving orders totaling JPY 453.1 billion, net sales of JPY 520.4 billion, and an operating profit of JPY 33.3 billion. Compared to the previous fiscal year, orders decreased due to inventory adjustments and lower semiconductor demand, although net sales increased overall, aided by foreign exchange gains. The forecast for FY 2024 has been revised to JPY 1.03 trillion in orders, JPY 1.07 trillion in net sales, and JPY 65 billion in operating profit. The interim dividend was set at JPY 60 per share, with a total return ratio of 65.9% and a return on invested capital of 5.6%. The company also outlined its Medium-Term Management Plan 2026, emphasizing business portfolio reformation, sustainability initiatives, and advancements in robotics and automation, semiconductor production, and offshore wind projects.Sumitomo Heavy Industries Financial Statement Overview
Summary
Income Statement
58
Neutral
Balance Sheet
72
Positive
Cash Flow
45
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Mar 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.07T | 1.08T | 1.14T | 943.98B | 849.07B |
| Gross Profit | 257.00B | 255.25B | 251.48B | 211.96B | 185.45B |
| EBITDA | 62.69B | 90.30B | 64.70B | 96.53B | 74.47B |
| Net Income | 7.72B | 32.74B | 7.71B | 44.05B | 26.76B |
Balance Sheet | |||||
| Total Assets | 1.26T | 1.20T | 1.15T | 1.09T | 1.03T |
| Cash, Cash Equivalents and Short-Term Investments | 111.13B | 104.46B | 97.48B | 88.78B | 99.52B |
| Total Debt | 248.28B | 171.00B | 171.74B | 111.25B | 136.54B |
| Total Liabilities | 613.83B | 573.39B | 571.95B | 528.09B | 525.76B |
| Stockholders Equity | 640.68B | 619.77B | 569.26B | 551.39B | 490.70B |
Cash Flow | |||||
| Free Cash Flow | -34.92B | 25.91B | -15.18B | -15.18B | 24.29B |
| Operating Cash Flow | 12.76B | 65.37B | 21.37B | 21.37B | 64.13B |
| Investing Cash Flow | -49.48B | -43.27B | -37.28B | -37.28B | -43.73B |
| Financing Cash Flow | 41.91B | -17.21B | 21.68B | 21.68B | -7.96B |
Sumitomo Heavy Industries Technical Analysis
Negative
4778.00
Price Trends
5280.54
Negative
4713.23
Positive
3986.80
Positive
Market Momentum
-123.09
Positive
36.40
Neutral
14.60
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6302, the sentiment is Negative. The current price of 4778 is below the 20-day moving average (MA) of 5445.50, below the 50-day MA of 5280.54, and above the 200-day MA of 3986.80, indicating a neutral trend. The MACD of -123.09 indicates Positive momentum. The RSI at 36.40 is Neutral, neither overbought nor oversold. The STOCH value of 14.60 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:6302.
Sumitomo Heavy Industries Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | ¥261.07B | 14.24 | ― | 1.65% | 14.49% | -21.17% | |
72 Outperform | ¥691.08B | 18.72 | 5.14% | 3.31% | -1.14% | -19.79% | |
71 Outperform | ¥475.50B | 26.32 | 5.25% | 2.13% | -2.23% | 130.96% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
59 Neutral | ¥681.43B | 29.16 | 11.66% | 1.03% | 10.11% | 41.98% | |
55 Neutral | ¥514.96B | -6.48 | 1.88% | 6.16% | 1.98% | -48.28% | |
54 Neutral | ¥601.98B | 11.29 | 4.83% | 2.95% | -2.67% | -85.21% |
* Industrials Sector Average
JP:6302
Sumitomo Heavy Industries
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Sumitomo Heavy Industries Corporate Events
Sumitomo Heavy Industries Corrects Major Shareholder Ownership Ratios After Calculation Error
Mar 11, 2026
Sumitomo Heavy Industries has corrected previously disclosed data regarding changes in a major shareholder’s voting rights, revising the reported ownership ratios due to a calculation error. The percentage of voting rights held by the shareh...
Sumitomo Heavy Industries Reports Change in Major Shareholder Stake
Mar 2, 2026
Sumitomo Heavy Industries has announced a change in its major shareholders following a large-volume shareholding report filed with the Kanto Local Finance Bureau by Silchester International Investors LLP. The London-based investment advisory firm ...
Sumitomo Heavy Industries to Divest Shin Nippon Machinery to Torishima Pump
Feb 10, 2026
Sumitomo Heavy Industries has agreed to transfer all shares of its consolidated subsidiary Shin Nippon Machinery to Torishima Pump Mfg., with execution scheduled for July 1, 2026. The deal advances Sumitomo’s selection-and-concentration stra...
Sumitomo Heavy Industries Lifts FY2025 Profit Despite Slight Dip in Sales
Feb 10, 2026
Sumitomo Heavy Industries reported FY2025 consolidated net sales of ¥1.07 trillion, edging down 0.4% year-on-year, with operating profit falling 6.6% to ¥51.5 billion and ordinary profit down 3.8% to ¥47.3 billion. Despite softer sa...
Sumitomo Heavy Industries Launches ¥10 Billion Share Buyback to Boost Capital Efficiency
Feb 10, 2026
Sumitomo Heavy Industries has approved a share buyback of up to 4 million common shares, representing about 3.32% of its outstanding stock, with a maximum outlay of ¥10 billion. The repurchase, to be executed via market purchases on the Tokyo...
Sumitomo Heavy Industries to Cut 500 Jobs Under Voluntary Retirement Plan
Feb 10, 2026
Sumitomo Heavy Industries will launch a voluntary retiree incentive program and revise reemployment agreements for staff aged 65 and over at the parent company and select domestic subsidiaries, aiming to cut roughly 500 positions across its Japane...
Sumitomo Heavy Industries to Transfer Parking System Business to IHI Transport Machinery
Jan 26, 2026
Sumitomo Heavy Industries announced that its consolidated subsidiary SHI-MH will transfer its parking system business to IHI Transport Machinery Co., Ltd. via an absorption-type company split, under a basic agreement signed on January 26, 2026. Th...
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.