Sony (6758) AI Stock Analysis

• Market Cap: $25.56T
• Dividend Yield: 0.47%
• Average Volume (3M): 12.89M
• Price to Earnings (P/E): 22.0
• Beta (1Y): 1.23
• Revenue Growth: -3.84%
• EPS Growth: 18.55%
• Country: JP
• Employees: 113,000
• Sector: Technology
• Sector Strength: 85
• Industry: Consumer Electronics
• EPS (TTM): 42.84
• Shares Outstanding: 6,149,810,500
• 10 Day Avg. Volume: 10,766,440
• 30 Day Avg. Volume: 12,892,376
• PEG Ratio: 1.01
• Price to Book (P/B): 2.78
• Price to Sales (P/S): 1.76
• P/FCF Ratio: 13.61
• Enterprise Value/Market Cap: 0.89
• Enterprise Value/Revenue: 1.82
• Enterprise Value/Gross Profit: 6.18
• Enterprise Value/Ebitda: 8.31
• 1Y Price Target: $4,794.40
• Price Target Upside: 12.12% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8

• Rating: 74 Outperform
• Price Target: ¥4,668.00 ▲(9.17% Upside)

Sony's strong financial performance is the most significant factor, supported by robust revenue growth and a stable balance sheet. Technical analysis shows bullish momentum, though caution is advised due to potential overbought conditions. Valuation metrics suggest the stock may be overvalued, impacting the overall score.

Positive Factors

Earnings Guidance

Sony revised its full-year operating profit guidance upwards, indicating confidence in its future performance.

Gaming Business

PS MAUs rose YoY for the 11th consecutive quarter, by 6%.

Stock Buyback

Sony executed a ¥60.9bn buyback, the largest monthly outlay in recent years, indicating strong confidence in its own stock.

Negative Factors

Competition

A potential risk is the plans by Samsung and Apple for a new factory that could impact Sony's sensor business.

Tariffs

Tariffs impact on PlayStation 5 hardware and electronic products and solutions margins pose challenges for Sony's near-term financial performance.

Sony Business Overview & Revenue Model

Company Description

Sony Group Corporation designs, develops, produces, and sells electronic equipment, instruments, and devices for the consumer, professional, and industrial markets in Japan, the United States, Europe, China, the Asia-Pacific, and internationally. The company distributes software titles and add-on content through digital networks; network services related to game, video, and music content; and home and portable game consoles, packaged software, and peripheral devices. It also develops, produces, markets, and distributes recorded music; publishes music; and produces and distributes animation titles, game applications, and various services for music and visual products. In addition, the company produces, acquires, and distributes live-action and animated motion pictures for theatrical release, as well as scripted and animated series, unscripted reality or light entertainment, daytime serials, game shows, television movies, and miniseries and other television programs; operates a visual effects and animation unit; manages a studio facility; and operates television and digital networks, and post-production facilities. Further, it researches, develops, designs, produces, markets, distributes, sells, and services televisions, and video and sound products; interchangeable lens, compact digital, and consumer and professional video cameras; projectors and medical equipment; mobile phones, tablets, accessories, and applications; and metal oxide semiconductor image sensors, charge-coupled devices, integration systems, and other semiconductors. Additionally, it offers Internet broadband network services; recording media, and storage media products; and life and non-life insurance, banking, and other services, as well as creates and distributes content for PCs and mobile phones. The company was formerly known as Sony Corporation and changed its name to Sony Group Corporation in April 2021. Sony Group Corporation was incorporated in 1946 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Sony generates revenue through a variety of streams across its multiple business segments. The electronics segment earns money from the sale of consumer and professional electronics, which include televisions, audio devices, and cameras. Sony's gaming segment, anchored by the PlayStation brand, profits from hardware sales, game software, and network services subscriptions. The entertainment segment contributes through Sony Pictures and Sony Music, which earn from box office sales, home entertainment, licensing, and music streaming. Additionally, Sony's financial services, primarily operated through Sony Financial Holdings, provide insurance and banking services, contributing to the company's earnings. Significant partnerships, such as collaborations for content distribution and technology development, also play a role in enhancing Sony's revenue.

Sony Financial Statement Overview

Summary

Sony demonstrates strong financial health with impressive revenue growth and profitability metrics. The balance sheet is stable with low leverage, and cash flow generation is robust. Some fluctuations in growth rates are noted, but the overall financial position is solid.

Income Statement

Sony's income statement shows strong performance with a significant revenue growth rate of 45% in the TTM period. The gross profit margin is healthy at 29.43%, and the net profit margin is solid at 9.13%. The EBIT and EBITDA margins are also robust, indicating efficient operations. However, the slight decline in annual revenue growth in the previous year suggests some volatility.

Balance Sheet

The balance sheet reflects a stable financial position with a low debt-to-equity ratio of 0.19 in the TTM period, indicating low leverage. The return on equity is strong at 14.17%, showcasing effective use of equity. The equity ratio is not explicitly provided, but the overall equity position appears solid. The reduction in total debt over time is a positive sign.

Cash Flow

Sony's cash flow statement is strong, with a notable free cash flow growth rate of 17.11% in the TTM period. The operating cash flow to net income ratio is moderate, suggesting reasonable cash generation relative to net income. The free cash flow to net income ratio is healthy at 77.99%, indicating good cash conversion. However, past fluctuations in free cash flow growth highlight potential volatility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	12.57T	12.96T	13.02T	10.97T	9.92T	9.00T
Gross Profit	3.70T	4.40T	4.07T	3.97T	3.32T	2.98T
EBITDA	2.75T	2.71T	2.46T	2.29T	2.03T	1.74T
Net Income	1.15T	1.14T	970.57B	1.01T	882.18B	1.03T
Balance Sheet
Total Assets	35.13T	35.29T	34.11T	31.15T	29.65T	27.51T
Cash, Cash Equivalents and Short-Term Investments	1.63T	3.45T	2.33T	1.83T	2.47T	2.22T
Total Debt	1.61T	4.20T	4.09T	4.06T	3.57T	2.65T
Total Liabilities	26.55T	26.78T	26.35T	24.50T	23.95T	20.78T
Stockholders Equity	8.30T	8.18T	7.59T	6.60T	5.65T	6.68T
Cash Flow
Free Cash Flow	1.97T	1.67T	749.27B	-298.94B	792.55B	662.29B
Operating Cash Flow	2.53T	2.32T	1.37T	314.69B	1.23T	1.14T
Investing Cash Flow	-744.32B	-930.12B	-818.89B	-1.05T	-728.78B	-960.61B
Financing Cash Flow	-512.39B	-298.24B	-210.71B	84.30B	-336.58B	58.16B

Sony Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4276.00
• 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:6758, the sentiment is Positive. The current price of 4276 is above the 20-day moving average (MA) of 4125.10, above the 50-day MA of 3855.76, and above the 200-day MA of 3576.47, indicating a bullish trend. The MACD of 74.56 indicates Positive momentum. The RSI at 62.49 is Neutral, neither overbought nor oversold. The STOCH value of 73.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6758.

Sony Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6758	74 Outperform	$25.56T	22.00	14.70%	0.47%	-3.84%	18.55%
Sector *	61 Neutral	$36.58B	11.16	-10.39%	1.86%	8.71%	-7.09%
CSIOF	―	$1.98B	52.48	2.56%	3.44%	―	―
KYOCF	―	$19.52B	106.33	0.81%	2.60%	―	―
PCRFF	―	$24.44B	9.88	7.89%	3.17%	―	―
JVC	―	€1.06B	9.05	15.38%	―	―	―
6753	62 Neutral	¥566.15B	8.75		―	-9.17%	―