Hitachi Zosen Corporation (7004) AI Stock Analysis

• Market Cap: ¥179.49B
• Dividend Yield: 2.41%
• Average Volume (3M): 837.20K
• Price to Earnings (P/E): 17.2
• Beta (1Y): 1.16
• Revenue Growth: 2.47%
• EPS Growth: 1.47%
• Country: JP
• Employees: 12,148
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Pollution & Treatment Controls
• EPS (TTM): -4.78
• Shares Outstanding: 170,214,840
• 10 Day Avg. Volume: 639,370
• 30 Day Avg. Volume: 837,203
• PEG Ratio: 0.42
• Price to Book (P/B): 0.81
• Price to Sales (P/S): 0.25
• P/FCF Ratio: -373.77
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 55.83
• Revenue Forecast (FY): ¥615.87B

• Rating: 66 Neutral
• Price Target: ¥1,151.00 ▲(20.02% Upside)
• Action: Downgraded Date: 11/08/25
• Date: Action: Downgraded 11/08/25

The overall stock score is driven by solid financial performance and attractive valuation metrics. However, technical analysis indicates bearish momentum, which tempers the overall outlook. The absence of recent earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Consistent revenue growth

Sustained revenue growth indicates durable demand for Hitachi Zosen's engineering and EPC services, supporting backlog replenishment and recurring lifecycle services. Over 2–6 months this trend underpins predictable project inflows and supports capacity planning and long-term customer relationships.

Stable EBIT/EBITDA margins

Stable operating margins reflect consistent execution and cost control across large-scale EPC and equipment contracts. Margin resilience provides a durable buffer against project cyclicality, helping sustain operating cash generation and enabling reinvestment in service capabilities and R&D over multiple quarters.

Prudent capital structure and rising ROE

A moderate leverage posture and improving ROE point to effective use of capital and financial flexibility to fund projects without overextending. This foundation supports bidding on large contracts, investing in lifecycle services, and maintaining resilience through multi-quarter project cycles.

Negative Factors

Volatile free cash flow

Free cash flow swings driven by project timing and capex needs reduce financial predictability and constrain discretionary spending. Over the medium term this can pressure liquidity, limit investment in growth initiatives, and increase reliance on working capital or external financing for large EPC projects.

Earnings volatility (EPS decline)

A substantial negative EPS growth rate signals earnings sensitivity to project mix, one-offs or timing differences. Persisting volatility undermines forecastability, complicates capital allocation and weakens confidence in sustained profitability over several quarters unless operational consistency improves.

Project-concentrated business model

Heavy reliance on milestone-driven EPC contracts creates lumpiness and execution risk: cost overruns, schedule delays and tight margins can materially affect results. Structurally this increases earnings and cashflow variability versus a more product- or service-recurring revenue mix.

Hitachi Zosen Corporation Business Overview & Revenue Model

Company Description

Kanadevia Corp design, constructs, and manufactures energy-from-waste plants, desalination plants, and water and sewage treatment plants in Japan and internationally. It operates through three segments: Environment, Machinery & Infrastructure, and Other. The company builds various water-related facilities, including sludge recycling centers and desalination plants, and energy-related facilities, including biomass plants, as well as engages in wind power generation. It also provides marine diesel engines, deck machinery for ships, process equipment, filter presses, industrial equipment, steel stacks, and spent nuclear fuel casks, as well as various types of precision machinery for electronics, semiconductor, food, and medical-related sectors; and engineering, procurement, construction, and after-sales services. In addition, the company engages in building, monitoring, maintenance, and repair of bridges and hydraulic gates for dams and rivers; developing shield tunneling machines for the construction of underground motorways and subway tracks, maintenance and earthquake protection systems for steel structures, electric discharge impulse crushing system, GPS comprehensive oceanographic monitoring systems, GPS remote monitoring systems, and flap-gate type seawalls against flood disaster due to tsunamis or storm surges. Further, it offers all-solid-state lithium-ion batteries and Zeolite Membrane Elements. Hitachi Zosen Corporation was founded in 1881 and is headquartered in Osaka, Japan.

How the Company Makes Money

Hitachi Zosen Corporation generates revenue through multiple streams, primarily by providing engineering services and manufacturing equipment for infrastructure projects, including waste management and water treatment facilities. The company earns money through the sale of its products, such as waste-to-energy plants and other environmental technologies. Additionally, it engages in project-based contracts, where it partners with government entities and private companies to deliver large-scale industrial solutions. Significant partnerships with local and international firms enhance its project capabilities and widen its market reach, contributing to consistent revenue growth. The company also benefits from after-sales services and maintenance contracts, ensuring ongoing income from its installations.

Hitachi Zosen Corporation Financial Statement Overview

Summary

Hitachi Zosen Corporation has demonstrated solid revenue growth and improved profitability, with stable EBIT and EBITDA margins. The balance sheet is stable with a moderate debt-to-equity ratio and increasing return on equity. However, cash flow management shows volatility, indicating a need for improved 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	TTM	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	614.40B	610.52B	555.84B	492.69B	441.80B	408.59B
Gross Profit	114.13B	114.19B	95.30B	83.36B	72.15B	72.81B
EBITDA	38.22B	37.86B	36.42B	31.03B	23.60B	18.41B
Net Income	21.28B	22.10B	19.00B	15.58B	7.90B	4.26B
Balance Sheet
Total Assets	564.56B	609.67B	533.59B	479.68B	461.16B	429.34B
Cash, Cash Equivalents and Short-Term Investments	53.25B	70.76B	71.61B	86.40B	67.20B	47.28B
Total Debt	107.47B	137.42B	91.44B	86.47B	91.88B	98.15B
Total Liabilities	374.68B	411.77B	364.65B	338.37B	328.24B	301.17B
Stockholders Equity	181.23B	189.37B	162.66B	139.62B	131.30B	126.33B
Cash Flow
Free Cash Flow	-29.61B	-412.00M	-11.62B	19.37B	17.63B	10.75B
Operating Cash Flow	-4.43B	24.77B	478.00M	28.01B	26.86B	22.68B
Investing Cash Flow	-33.57B	-56.57B	-21.49B	-2.46B	943.00M	-13.85B
Financing Cash Flow	8.85B	30.15B	-2.61B	-7.84B	-8.76B	-5.27B

Hitachi Zosen Corporation Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 959.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7004, the sentiment is Neutral. The current price of 959 is below the 20-day moving average (MA) of 1078.80, below the 50-day MA of 1026.82, and below the 200-day MA of 1006.74, indicating a neutral trend. The MACD of 12.82 indicates Positive momentum. The RSI at 50.55 is Neutral, neither overbought nor oversold. The STOCH value of 13.54 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7004.

Hitachi Zosen Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6332	80 Outperform	¥133.12B	7.74	―	3.20%	2.46%	533.70%
9551	76 Outperform	¥148.94B	17.81	12.54%	1.84%	13.86%	51.05%
6370	72 Outperform	¥957.47B	39.74	6.61%	1.58%	5.02%	-27.41%
6013	71 Outperform	¥227.07B	19.02	9.02%	3.11%	1.25%	-3.97%
6368	71 Outperform	¥774.83B	27.54	―	1.43%	7.87%	38.32%
7004	66 Neutral	¥179.49B	17.22	―	2.41%	2.47%	1.47%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Hitachi Zosen Corporation Corporate Events

Kanadevia Swings to Loss Despite Higher Sales, Cuts Full-Year Profit Outlook

Kanadevia Corporation reported a swing to loss for the nine months ended December 31, 2025, despite a 2.7% rise in net sales to ¥424.7 billion. Operating income fell into a ¥4.7 billion loss from a ¥9.7 billion profit a year earlier, ordinary income likewise turned negative, and profit attributable to shareholders dropped to a ¥6.3 billion loss, translating to a net loss per share of ¥37.52. The company’s financial position also weakened, with the shareholders’ equity ratio declining from 31.1% at fiscal year-end to 27.0% as of December 31, 2025, even as total assets increased to ¥655.2 billion. Kanadevia maintained its dividend stance with no interim payout but continues to project a full-year dividend of ¥25 per share, signaling a commitment to shareholder returns despite the earnings downturn. For the full fiscal year ending March 31, 2026, management revised its earnings forecast, now expecting modest sales growth to ¥620 billion but sharp year-on-year declines in profit, with operating income projected to halve and net profit to fall by over 70% to ¥5 billion, reflecting ongoing cost and business-structure pressures, including the exclusion of several H&F Group subsidiaries from the consolidation scope.

The most recent analyst rating on (JP:7004) stock is a Hold with a Yen1119.00 price target. To see the full list of analyst forecasts on Hitachi Zosen Corporation stock, see the JP:7004 Stock Forecast page.

Kanadevia Halves Profit Forecast for FY2026 on Troubles at Overseas Environmental Units

Kanadevia Corporation has revised downward its full-year consolidated earnings forecast for the fiscal year ending March 31, 2026, keeping net sales unchanged at ¥620 billion but cutting operating income by 25% to ¥13.5 billion, ordinary income by 7.1% to ¥13 billion, and profit attributable to shareholders by 50% to ¥5 billion, resulting in an expected halving of earnings per share to ¥29.73 versus the prior forecast. The company attributes the deterioration mainly to technical troubles at overseas environmental subsidiaries that have eroded profitability and led to extraordinary losses, though equity-method investment gains are partially supporting ordinary income; despite the sharp profit downgrade from both the prior forecast and the previous year’s results, Kanadevia has maintained its year-end dividend forecast, signaling an intention to provide stability for shareholders amid operational challenges.

The most recent analyst rating on (JP:7004) stock is a Hold with a Yen1119.00 price target. To see the full list of analyst forecasts on Hitachi Zosen Corporation stock, see the JP:7004 Stock Forecast page.

Kanadevia to Exit Century-Old Bridge Business, Close Mukaishima Works Amid Market Contraction

Kanadevia Corporation has resolved to withdraw from its bridge construction business and terminate operations at its Mukaishima Works in Hiroshima, bringing to an end more than 120 years of activity in steel bridge construction. The decision follows a prolonged contraction in Japan’s new bridge construction market since the mid-1990s, intensified competition and declining order volumes that made continued operation of the works uneconomical. Under its “Forward 25” medium-term plan, the company is reallocating resources through business selection and concentration, and the bridge segment, which accounted for 1.7% of consolidated sales in FY2024, will be wound down gradually: marketing for new projects ceases immediately, plant operations will end in fiscal 2026 after existing orders are processed, and full withdrawal from the bridge business is planned by fiscal 2030. Kanadevia intends to maintain employment for the roughly 239 workers in the bridge business, reassigning them in consultation with the labor union, and will continue inspections and monitoring related to previously disclosed inappropriate conduct at Mukaishima Works. Financially, the restructuring has already led to an impairment charge of ¥1.6 billion in the third quarter of the fiscal year ending March 31, 2026, signaling a non-trivial but contained hit as the company reshapes its portfolio and long-term positioning in the infrastructure manufacturing sector.

The most recent analyst rating on (JP:7004) stock is a Hold with a Yen1119.00 price target. To see the full list of analyst forecasts on Hitachi Zosen Corporation stock, see the JP:7004 Stock Forecast page.

Kanadevia to Dilute Stake in Marine Engine Unit, Making It an Equity-Method Affiliate

Kanadevia Corporation will transfer part of its stake in Hitachi Zosen Marine Engine Co., Ltd. to co-investor Imabari Shipbuilding, changing HZME’s status from a consolidated subsidiary to an equity-method affiliate to accelerate its growth and enhance corporate value under Imabari’s stronger shipbuilding focus. The move aligns with Japan’s government-led “Shipbuilding Industry Revitalization Roadmap,” as Kanadevia pursues portfolio restructuring and optimal resource allocation under its medium-term plan “Forward 25,” aiming to respond swiftly to rapid industry changes while supporting HZME’s capital investment, business expansion, and long-term competitiveness in the marine engine market.

The most recent analyst rating on (JP:7004) stock is a Hold with a Yen1119.00 price target. To see the full list of analyst forecasts on Hitachi Zosen Corporation stock, see the JP:7004 Stock Forecast page.

Kanadevia and Nippon Steel Engineering Open Talks on 2027 Environmental Business Integration

Kanadevia and Nippon Steel Engineering have signed a basic memorandum of understanding to begin formal talks on a business integration that could be completed as early as April 2027, subject to a definitive agreement and shareholder approvals planned for 2026. The contemplated merger seeks to combine closely aligned environmental, decarbonization, and infrastructure portfolios into an industry‑leading platform capable of capturing rising global demand for waste-to-energy and other resource‑circulation projects, while addressing structural challenges such as labor shortages, supply-chain stability, and the need for digital transformation, with the aim of building a stronger earnings base in Japan and deploying capital and technology more aggressively in overseas markets for the benefit of stakeholders.

The most recent analyst rating on (JP:7004) stock is a Hold with a Yen1119.00 price target. To see the full list of analyst forecasts on Hitachi Zosen Corporation stock, see the JP:7004 Stock Forecast page.

Kanadevia Corporation Addresses Inappropriate Conduct at Mukaishima Works

Kanadevia Corporation has submitted an interim report to the Ministry of Land, Infrastructure, Transport and Tourism regarding inappropriate conduct at its Mukaishima Works. The issue involved inadequate qualifications of welding operators in the production of bridges and other structures. While the company assures that the safety of the products is not significantly impacted, it plans to conduct inspections and follow-up monitoring in collaboration with road administrators. Kanadevia is also implementing further preventive measures to avoid recurrence of such issues, aiming to restore trust among stakeholders.

The most recent analyst rating on (JP:7004) stock is a Hold with a Yen1001.00 price target. To see the full list of analyst forecasts on Hitachi Zosen Corporation stock, see the JP:7004 Stock Forecast page.