Hitachi Zosen Corporation (7004) AI Stock Analysis

• Market Cap: ¥174.94B
• Dividend Yield: 2.21%
• Average Volume (3M): 937.57K
• Price to Earnings (P/E): 8.2
• Beta (1Y): 1.04
• Revenue Growth: 6.86%
• EPS Growth: 18.01%
• Country: JP
• Employees: 12,148
• Sector: Industrials
• Sector Strength: 74
• Industry: Industrial - Pollution & Treatment Controls
• EPS (TTM): -21.60
• Shares Outstanding: 170,214,840
• 10 Day Avg. Volume: 1,008,960
• 30 Day Avg. Volume: 937,573
• 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: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ¥1,090.00
• Price Target Upside: 4.71% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 71 Outperform
• Price Target: ¥1,090.00 ▲(4.71% Upside)

Hitachi Zosen Corporation's stock score is primarily driven by its strong valuation, with a low P/E ratio and attractive dividend yield. Financial performance is solid, with room for improvement in cash flow management. Technical indicators suggest potential short-term weakness, but the stock may be undervalued, presenting a buying opportunity.

Hitachi Zosen Corporation Business Overview & Revenue Model

Company Description

Hitachi Zosen Corporation, headquartered in Osaka, Japan, is a leading engineering and manufacturing company specializing in environmental and plant engineering, industrial machinery, and infrastructure solutions. The company operates across several sectors, including energy-from-waste plants, desalination and water treatment facilities, and precision machinery manufacturing. With a rich history dating back to 1881, Hitachi Zosen leverages its technological expertise to provide sustainable and innovative solutions worldwide.

How the Company Makes Money

Hitachi Zosen Corporation generates revenue through a diversified business model that includes multiple key revenue streams. The company earns a significant portion of its income from its environmental systems segment, which designs and constructs waste-to-energy plants and water treatment facilities, providing both construction and maintenance services. Additionally, Hitachi Zosen's precision machinery sector, which includes the manufacture of industrial machinery such as marine diesel engines and process equipment, contributes to its earnings. The company also engages in infrastructure projects and has partnerships with government bodies and private entities to develop sustainable solutions, enhancing its revenue stream. Hitachi Zosen's emphasis on innovation and sustainability, coupled with its global presence, strengthens its position in the market, driving consistent revenue growth.

Hitachi Zosen Corporation Financial Statement Overview

Summary

Hitachi Zosen Corporation has demonstrated solid revenue growth and improved profitability, supported by efficient operational management. The balance sheet is stable with a moderate debt-to-equity ratio, though there is room to strengthen the equity position. Cash flow performance is mixed, indicating a need for better capital expenditure management.

Income Statement

Hitachi Zosen Corporation has demonstrated solid revenue growth with a consistent upward trajectory over the past years. The gross profit and net profit margins have shown improvement, reflecting enhanced operational efficiency. The EBIT and EBITDA margins are stable, indicating healthy earnings before interest and taxes. However, the net profit margin, while improving, still has room for growth to reach industry-leading levels.

Balance Sheet

The company maintains a balanced approach to its capital structure with a moderate debt-to-equity ratio, reflecting prudent use of leverage. The return on equity has been increasing, showcasing effective utilization of shareholders' funds. The equity ratio suggests a solid foundation, though there is potential to strengthen the equity position further to enhance financial stability.

Cash Flow

Hitachi Zosen’s cash flow management shows some volatility, with free cash flow fluctuating in recent years. The operating cash flow to net income ratio indicates effective cash generation from core operations. However, the free cash flow to net income ratio suggests a need for improved capital expenditure management to enhance cash flow performance.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	610.52B	555.84B	492.69B	441.80B	408.59B
Gross Profit	114.19B	95.30B	83.36B	72.15B	72.81B
EBITDA	37.86B	36.42B	31.03B	26.46B	26.20B
Net Income	22.10B	19.00B	15.58B	7.90B	4.26B
Balance Sheet
Total Assets	609.67B	533.59B	479.68B	461.16B	429.34B
Cash, Cash Equivalents and Short-Term Investments	70.76B	71.61B	86.40B	67.20B	47.28B
Total Debt	135.76B	91.44B	86.47B	91.88B	98.15B
Total Liabilities	411.77B	364.65B	338.37B	328.24B	301.17B
Stockholders Equity	189.37B	162.66B	139.62B	131.30B	126.33B
Cash Flow
Free Cash Flow	-412.00M	-11.62B	19.37B	17.63B	10.75B
Operating Cash Flow	24.77B	478.00M	28.01B	26.86B	22.68B
Investing Cash Flow	-56.57B	-21.49B	-2.46B	943.00M	-13.85B
Financing Cash Flow	30.15B	-2.61B	-7.84B	-8.76B	-5.27B

Hitachi Zosen Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1041.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7004, the sentiment is Positive. The current price of 1041 is above the 20-day moving average (MA) of 1004.95, above the 50-day MA of 1003.90, and above the 200-day MA of 943.60, indicating a bullish trend. The MACD of 5.66 indicates Negative momentum. The RSI at 62.60 is Neutral, neither overbought nor oversold. The STOCH value of 95.25 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7004.

Hitachi Zosen Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7004	71 Outperform	¥174.94B	8.20		2.21%	6.86%	18.01%
Sector *	64 Neutral	$10.75B	15.58	7.24%	2.01%	2.80%	-14.32%
KTWIF	―	$3.87B	28.72	6.24%	1.66%	―	―
MTWTF	―	$759.30M	19.09	9.80%	1.65%	―	―
TKUMF	―	$1.22B	19.35	8.81%	3.93%	―	―
6332	77 Outperform	¥142.98B	16.30		2.26%	7.01%	217.10%
6368	72 Outperform	¥533.69B	21.29		1.20%	11.42%	36.49%

Hitachi Zosen Corporation Corporate Events

Kanadevia Corporation Addresses Inappropriate Conduct Across Business Sectors

Kanadevia Corporation has been dealing with inappropriate conduct in its marine engine business and other sectors. A Special Investigation Committee was established to address these issues, and the company has received the investigation results for businesses other than the marine engine sector. Despite the inappropriate conduct, the company assures stakeholders that there is no immediate impact on product safety and is committed to implementing measures to prevent recurrence and restore trust.

Kanadevia Corporation Proposes Amendments to Strengthen Governance

Kanadevia Corporation has announced a proposal to amend its Articles of Incorporation, specifically aiming to abolish the position of Counselors. This move is intended to strengthen corporate governance and enhance management transparency, reflecting the company’s commitment to improving its operational framework.

Kanadevia Corporation Reports Significant Profit Increase Despite Operational Challenges

Kanadevia Corporation has reported a significant change in its non-consolidated financial results for the fiscal year ending March 2025, with a notable over 30% increase in profit compared to the previous year. The company experienced a decrease in operating and ordinary income due to challenges in its Machinery & Infrastructure and Carbon Neutral Solution businesses, as well as foreign exchange losses. However, a reduction in tax expenses led to an increase in net income.

Kanadevia Corporation Reports Extraordinary Losses Due to Inappropriate Conduct

Kanadevia Corporation has recorded extraordinary losses for the fiscal year ending March 31, 2025, due to inappropriate conduct in its marine engine business and other sectors. The company has accounted for investigation and compliance costs, totaling 3.5 billion yen in consolidated financial statements and 3.2 billion yen in non-consolidated financial statements, impacting its financial results.

Kanadevia Corporation Increases Year-End Dividend Amid Strong Fiscal Performance

Kanadevia Corporation announced an increase in its year-end dividend to 25 yen per share, reflecting a strong fiscal performance that exceeded initial forecasts. The company plans to continue stable dividend distribution while investing in growth areas to strengthen its financial position and management base.