Kawasaki Heavy Industries (7012) AI Stock Analysis

• Market Cap: ¥1.71T
• Dividend Yield: 1.47%
• Average Volume (3M): 5.36M
• Price to Earnings (P/E): 17.6
• Beta (1Y): 2.00
• Revenue Growth: 14.12%
• EPS Growth: 54.64%
• Country: JP
• Employees: 39,689
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 106.77
• Shares Outstanding: 167,921,800
• 10 Day Avg. Volume: 5,883,960
• 30 Day Avg. Volume: 5,358,010
• PEG Ratio: 0.07
• Price to Book (P/B): 2.13
• Price to Sales (P/S): 0.70
• P/FCF Ratio: 29.75
• 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: ¥11,881.57
• Price Target Upside: 16.54% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 67 Neutral
• Price Target: ¥11,572.00 ▲(13.51% Upside)

Kawasaki Heavy Industries demonstrates solid financial performance with strong revenue growth and a robust equity position. However, cash flow challenges and operational efficiency improvements are areas of concern. The earnings call provided a balanced view with significant achievements in revenue and innovation, but also highlighted profitability challenges and external pressures such as tariffs.

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 multiple key streams across its diverse business segments. The aerospace and defense division contributes significantly through contracts for military and commercial aircraft, as well as missile and defense systems. The rolling stock segment earns revenue from the production of trains and related infrastructure. Shipbuilding generates income from the construction of commercial and naval vessels. The industrial equipment segment provides machinery and systems for various industries, while the energy systems division focuses on power generation and environmental solutions. Strategic partnerships with governments and other corporations, along with long-term contracts, play a crucial role in stabilizing revenue, particularly in the defense and aerospace sectors, where projects often span several years.

Kawasaki Heavy Industries Financial Statement Overview

Summary

Kawasaki Heavy Industries demonstrates solid revenue growth and profitability with a strong equity position and no debt reliance. However, cash flow challenges and operational efficiency improvements are areas to watch.

Income Statement

Kawasaki Heavy Industries shows a solid revenue growth rate of 2.08% TTM, indicating a positive trajectory. The gross profit margin of 20.27% and net profit margin of 4.13% TTM reflect stable profitability. However, the EBIT margin of 5.63% and EBITDA margin of 10.02% TTM suggest room for operational efficiency improvements.

Balance Sheet

The company has a strong equity base with a debt-to-equity ratio of 0.0 TTM, indicating no reliance on debt financing. Return on equity is healthy at 13.20% TTM, showcasing effective use of equity. However, the equity ratio is not provided, limiting a full assessment of asset financing.

Cash Flow

Operating cash flow is positive, but the free cash flow growth rate is negative at -26.26% TTM, indicating potential cash flow challenges. The operating cash flow to net income ratio of 0.08 TTM suggests limited cash generation relative to net income, while the free cash flow to net income ratio of 0.34 TTM shows some cash flow support.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.17T	2.13T	1.85T	1.73T	1.50T	1.49T
Gross Profit	437.93B	431.54B	312.24B	333.82B	253.26B	191.16B
EBITDA	220.70B	239.98B	130.22B	154.01B	109.92B	50.36B
Net Income	76.87B	88.00B	25.38B	53.03B	12.64B	-19.33B
Balance Sheet
Total Assets	2.97T	3.02T	2.68T	2.46T	2.17T	1.96T
Cash, Cash Equivalents and Short-Term Investments	73.90B	144.55B	95.18B	138.42B	119.12B	126.70B
Total Debt	820.54B	889.51B	845.23B	785.26B	501.48B	571.35B
Total Liabilities	2.17T	2.29T	2.03T	1.86T	1.65T	1.48T
Stockholders Equity	735.91B	702.91B	634.09B	576.20B	505.48B	465.33B
Cash Flow
Free Cash Flow	37.06B	50.26B	-48.40B	-35.33B	97.95B	-17.09B
Operating Cash Flow	117.57B	148.94B	31.66B	23.62B	156.89B	34.60B
Investing Cash Flow	-123.21B	-111.20B	-89.81B	-77.46B	-58.40B	-37.39B
Financing Cash Flow	-30.25B	9.61B	12.91B	85.31B	-108.90B	23.09B

Kawasaki Heavy Industries Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 10195.00
• 50DMA: Negative
• 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:7012, the sentiment is Neutral. The current price of 10195 is below the 20-day moving average (MA) of 11328.00, below the 50-day MA of 10279.62, and above the 200-day MA of 9404.51, indicating a neutral trend. The MACD of -49.05 indicates Positive momentum. The RSI at 42.61 is Neutral, neither overbought nor oversold. The STOCH value of 17.16 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7012.

Kawasaki Heavy Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6104	81 Outperform	€95.29B	9.75	5.02%	3.37%	-10.00%	-51.92%
6361	69 Neutral	$1.93T	26.22	16.00%	1.34%	13.96%	12.97%
7012	67 Neutral	¥1.71T	17.62	13.25%	1.47%	14.12%	54.64%
5631	66 Neutral	€724.49B	38.70	11.66%	0.93%	10.11%	41.98%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
7013	62 Neutral	$3.40T	31.53	26.54%	0.63%	-1.66%	19.02%
6302	59 Neutral	$513.04B	151.45	0.59%	3.15%	-2.67%	-85.21%

Kawasaki Heavy Industries Corporate Events

Kawasaki Heavy Industries Reports Strong Revenue Growth

Kawasaki Heavy Industries, Ltd. is a diversified Japanese multinational corporation engaged in the manufacturing of transportation equipment and industrial goods, operating primarily in sectors such as aerospace, energy, and robotics.

Kawasaki Heavy Industries Reports Record Revenue Amid Profit Challenges

Kawasaki Heavy Industries reported a record revenue of 996.2 billion yen for the second quarter of FY2025, despite a decline in business profit due to yen appreciation and higher tariffs. The company raised its full-year revenue forecast to 2,340.0 billion yen, maintaining its business profit forecast at 145.0 billion yen, with expectations of stronger performance in the second half driven by defense contracts and increased after-sales services for aircraft engines.

The most recent analyst rating on (JP:7012) stock is a Buy with a Yen13000.00 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 Reports Strong Half-Year Results with Revised Earnings Forecast

Kawasaki Heavy Industries announced its consolidated financial results for the six months ending September 30, 2025. The company reported a notable increase in revenue and profit compared to the previous year, reflecting strong operational performance. Despite the positive financial results, the company revised its earnings forecast for the fiscal year ending March 31, 2026, indicating adjustments in its financial expectations. The announcement underscores Kawasaki’s efforts to maintain its competitive position in the market while adapting to changing economic conditions.

The most recent analyst rating on (JP:7012) stock is a Buy with a Yen13000.00 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 Addresses Testing Misconduct in Marine Engines

Kawasaki Heavy Industries has identified misconduct in the testing of its marine and submarine engines, prompting an independent investigation by a Special Investigative Committee. The company is taking steps to address these issues by reinforcing compliance and governance frameworks, and is cooperating fully with the ongoing investigation to restore trust and ensure transparency. The potential financial impact of these findings is still under examination.

The most recent analyst rating on (JP:7012) stock is a Hold with a Yen10108.00 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’ Earnings Call: Mixed Results and Future Outlook

The recent earnings call for Kawasaki Heavy Industries painted a mixed picture for investors and stakeholders. While the company celebrated significant achievements in revenue and innovation, challenges in profitability and cash flow were also highlighted. The sentiment was balanced, reflecting both the highs and lows of the company’s current financial standing.