Kawasaki Heavy Industries (7012) AI Stock Analysis

• Market Cap: $1.88T
• Dividend Yield: 1.25%
• Average Volume (3M): 11.31M
• Price to Earnings (P/E): 21.4
• Beta (1Y): 1.90
• Revenue Growth: 15.14%
• EPS Growth: 246.85%
• Country: JP
• Employees: 39,689
• Sector: Industrials
• Sector Strength: 87
• Industry: Industrial - Machinery
• EPS (TTM): 261.80
• Shares Outstanding: 167,921,800
• 10 Day Avg. Volume: 6,047,090
• 30 Day Avg. Volume: 11,307,433
• PEG Ratio: 0.06
• Price to Book (P/B): 0.84
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -10.46
• 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: $12,473.60
• Price Target Upside: 11.12% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 66 Neutral
• Price Target: ¥11,583.00 ▲(3.19%Upside)

Kawasaki Heavy Industries' strong financial performance is the most significant factor driving the stock score. While technical analysis shows positive momentum, potential overbought conditions could impact short-term performance. The moderate valuation suggests the stock is fairly priced, but the low dividend yield may not attract income-focused investors.

Kawasaki Heavy Industries Business Overview & Revenue Model

Company Description

Kawasaki Heavy Industries, Ltd. engages in aerospace systems, energy solution and marine engineering, precision machinery and robot, rolling stock, and motorcycle and engine businesses in Japan and internationally. It manufactures aircraft for the Japan ministry of defense; helicopters; and helicopter engines and jet engines for commercial aircrafts. The company also manufactures railway cars; a range of rolling stocks, including Shinkansen, electric cars, passenger coaches, freight cars, locomotives, diesel locomotives, transit systems, and snow plows. In addition, it engages in the production and sale of energy-related machinery and systems, marine machinery and systems, industrial equipment, environmental equipment, ultralow temperature tanks, hydrogen-related structures, crushers, ships, other vessels, etc. Further, the company manufactures and supplies motorcycles, off-road four wheelers, watercrafts, general-purpose gasoline engines, etc. Additionally, it manufactures and sells hydraulic machinery used in construction and agricultural machinery, industrial machinery, and ships; pumps, motors, valves, and various hydraulic machinery, as well as assembles hydraulic systems; and industrial robots for use in welding, assembly, handling, painting, and palletization for various industries, including automotive and electronics industries. Kawasaki Heavy Industries, Ltd. was founded in 1878 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Kawasaki Heavy Industries generates revenue through a diversified business model that includes key revenue streams from its various sectors. In the aerospace division, the company earns by manufacturing aircraft components and systems for commercial and defense aviation. The shipbuilding sector contributes through the design and construction of vessels such as submarines, bulk carriers, and LNG carriers. Its rolling stock business provides income from the production of high-speed trains and commuter rail systems. The energy systems and industrial equipment division generates revenue by delivering power generation systems, gas turbines, and other industrial machinery. Additionally, Kawasaki's motorcycle and engine segment is a significant contributor, with sales from its popular range of motorcycles, personal watercraft, and general-purpose engines. The company also benefits from strategic partnerships and collaborations, enhancing its technological capabilities and market reach.

Kawasaki Heavy Industries Financial Statement Overview

Summary

Kawasaki Heavy Industries demonstrated robust financial performance with substantial revenue growth and improved profit margins. The balance sheet shows a moderate leverage position, and while cash flow management has improved, further optimization is needed.

Income Statement

Kawasaki Heavy Industries showed robust performance with significant revenue growth from 2024 to 2025, demonstrating a revenue growth rate of approximately 15.1%. The gross profit margin improved to about 20.3% in 2025, reflecting enhanced cost management. Net profit margin increased to around 4.1%, indicating stronger profitability. The EBIT and EBITDA margins have also shown substantial improvement, suggesting better operational efficiency.

Balance Sheet

The company's debt-to-equity ratio in 2025 is approximately 1.27, indicating a moderate leverage position. The return on equity (ROE) improved to about 12.5%, showcasing effective utilization of equity for generating profits. The equity ratio, standing at around 23.3%, suggests a balanced capital structure but highlights potential risks associated with high leverage.

Cash Flow

Kawasaki Heavy Industries demonstrated a strong recovery in free cash flow, achieving a positive free cash flow growth from 2024 to 2025. The operating cash flow to net income ratio of approximately 1.69 suggests effective cash generation from core operations. However, the free cash flow to net income ratio remains lower, indicating room for improvement in cash management strategies.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	2.13T	1.85T	1.73T	1.50T	1.49T
Gross Profit	431.54B	312.24B	333.82B	256.58B	191.16B
EBITDA	216.80B	130.22B	157.46B	124.33B	50.36B
Net Income	88.00B	25.38B	53.03B	21.80B	-19.33B
Balance Sheet
Total Assets	3.02T	2.68T	2.46T	2.02T	1.96T
Cash, Cash Equivalents and Short-Term Investments	132.78B	84.15B	149.16B	114.47B	126.70B
Total Debt	889.51B	845.23B	785.26B	501.48B	571.35B
Total Liabilities	2.29T	2.03T	1.86T	1.52T	1.48T
Stockholders Equity	702.91B	634.09B	576.20B	479.18B	465.33B
Cash Flow
Free Cash Flow	50.26B	-64.88B	-46.33B	82.03B	-17.09B
Operating Cash Flow	148.94B	31.66B	23.62B	144.43B	34.60B
Investing Cash Flow	-111.20B	-89.81B	-77.46B	-52.54B	-37.39B
Financing Cash Flow	9.61B	12.91B	85.31B	-102.34B	23.09B

Kawasaki Heavy Industries Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 11225.00
• 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:7012, the sentiment is Positive. The current price of 11225 is above the 20-day moving average (MA) of 10579.75, above the 50-day MA of 9454.24, and above the 200-day MA of 7451.05, indicating a bullish trend. The MACD of 331.68 indicates Positive momentum. The RSI at 67.82 is Neutral, neither overbought nor oversold. The STOCH value of 60.61 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7012.

Kawasaki Heavy Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7012	66 Neutral	$1.88T	21.36	12.94%	1.25%	15.14%	246.85%
Sector *	58 Neutral	$1.33B	4.26	-2.93%	8.38%	3.41%	-51.76%
EBCOF		$8.65B	16.25	16.07%	2.20%	―	―
IHICF		$16.66B	20.38	25.94%	0.94%	―	―
J9R		€3.69B	33.27	9.67%	0.91%	―	―
SOHVF		$2.50B	1,011.71	0.06%	3.80%	―	―
TOA		€412.81M	5.75	10.88%	4.40%	―	―

Kawasaki Heavy Industries Corporate Events

Kawasaki Heavy Industries Considers Investment Unit Reduction

Kawasaki Heavy Industries has announced its consideration of reducing its investment unit to enhance stock market vitality by expanding its investor base and improving stock liquidity. The company will evaluate this decision based on market trends, shareholder composition, and stock liquidity, aligning with Tokyo Stock Exchange regulations.

The most recent analyst rating on (JP:7012) stock is a Hold with a Yen6400.00 price target. To see the full list of analyst forecasts on Kawasaki Heavy Industries stock, see the JP:7012 Stock Forecast page.

Kawasaki Heavy Industries to Integrate Subsidiary Segments for Enhanced Efficiency

Kawasaki Heavy Industries has announced a strategic move to integrate the Facility Maintenance, Inspection, and Repair segment and the On-site Service segment of its subsidiary, Kawaju Support Co., Ltd., into its main operations at the Sakaide Works. This absorption-type split, effective October 1, 2025, aims to enhance productivity and efficiency through digital transformation, aligning with the company’s vision of a digital shipyard. The integration is expected to streamline operations and bolster the company’s competitive positioning in the shipbuilding industry.

The most recent analyst rating on (JP:7012) stock is a Hold with a Yen6400.00 price target. To see the full list of analyst forecasts on Kawasaki Heavy Industries stock, see the JP:7012 Stock Forecast page.

Kawasaki Heavy Industries and Furukawa Co. Discuss EarthTechnica Share Transfer

Kawasaki Heavy Industries and Furukawa Co., Ltd. have signed a Memorandum of Understanding to discuss the transfer of shares of EarthTechnica Co., Ltd., a subsidiary of Kawasaki engaged in crushing and grinding equipment. This move aims to enhance Furukawa’s technological capabilities and market reach, particularly in the environmental recycling sector, while leveraging EarthTechnica’s advanced technologies and reputation. The transaction is expected to create synergies, expand business domains, and strengthen operations in the global mining and quarry markets.

The most recent analyst rating on (JP:7012) stock is a Hold with a Yen6400.00 price target. To see the full list of analyst forecasts on Kawasaki Heavy Industries stock, see the JP:7012 Stock Forecast page.

Kawasaki Heavy Industries Announces Board of Directors Changes

Kawasaki Heavy Industries has announced changes to its Board of Directors, aiming to enhance the board’s supervisory functions. These changes include the reappointment of several directors and the introduction of a new member to the Audit and Supervisory Committee, which are expected to be approved at the upcoming Annual General Meeting. This restructuring is intended to strengthen corporate governance and oversight, potentially impacting the company’s strategic direction and stakeholder confidence.

Kawasaki Heavy Industries Reports Significant Foreign Exchange Loss

Kawasaki Heavy Industries announced a significant foreign exchange loss of ¥16,094 million for the fiscal year ending March 31, 2025, primarily due to currency fluctuations. This financial impact is detailed in their earnings report, highlighting the challenges faced in managing foreign exchange risks and its implications for the company’s financial performance.

Kawasaki Heavy Industries Reports Strong Financial Growth for FY2025

Kawasaki Heavy Industries reported a substantial increase in its financial performance for the fiscal year ending March 31, 2025, with revenue rising by 15.1% and profit before tax soaring by 236.2% compared to the previous year. This robust growth reflects improved operational efficiency and market demand, positioning the company strongly within its industry and benefiting its stakeholders.

Kawasaki Heavy Industries Achieves Record Profit, Anticipates Further Growth

Kawasaki Heavy Industries reported a record business profit of 143.1 billion yen for FY2024, surpassing its previous forecast. The company expects to achieve even higher profits in FY2025 despite potential challenges from U.S. tariff policies, which may impact its PS&E segment. The forecast has accounted for some market risks, although the full cost impact of tariffs remains uncertain.

Kawasaki Heavy Industries Announces Dividend Increase

Kawasaki Heavy Industries announced an increase in its year-end dividend per share to ¥80, resulting in an annual dividend of ¥150 per share, reflecting a strategic decision to enhance shareholder value. This move aligns with Kawasaki’s medium- to long-term goal of maintaining a 30% dividend payout ratio, demonstrating its commitment to providing stable returns to shareholders.

Kawasaki Heavy Industries Pays ¥1 Billion Following Tax Investigation

Kawasaki Heavy Industries has completed a tax investigation by the Osaka Regional Taxation Bureau, resulting in an amended tax return and an additional payment of approximately ¥1 billion. The investigation revealed unreported income related to inappropriate expenses in the submarine repairs business and an error under Japan’s controlled foreign corporation rules affecting a North American joint-stock venture. The company is committed to improving its tax accounting practices.