Canon Inc. (7751) AI Stock Analysis

• Market Cap: ¥4.16T
• Dividend Yield: 3.61%
• Average Volume (3M): 3.03M
• Price to Earnings (P/E): 24.1
• Beta (1Y): 0.73
• Revenue Growth: 9.08%
• EPS Growth: -33.61%
• Country: JP
• Employees: 111,733
• Sector: Technology
• Sector Strength: 83
• Industry: Computer Hardware
• EPS (TTM): 77.27
• Shares Outstanding: 1,333,763,400
• 10 Day Avg. Volume: 2,840,760
• 30 Day Avg. Volume: 3,027,753
• PEG Ratio: 2.34
• Price to Book (P/B): 1.28
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 11.17
• 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: ¥4,633.33
• Price Target Upside: 8.00% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 3

• Rating: 70 Outperform
• Price Target: ¥5,151.00 ▲(20.07%Upside)

Canon Inc. maintains a robust financial standing with strong profitability and cash flow generation. While technical indicators suggest potential for upward momentum, they also highlight recent downward trends. The stock's high P/E ratio indicates possible overvaluation, although this is somewhat offset by an attractive dividend yield. Overall, Canon's financial health and stability in the computer hardware industry contribute positively, but valuation concerns and recent technical trends weigh on the score.

Canon Inc. Business Overview & Revenue Model

Company Description

Canon Inc. is a leading global manufacturer of imaging and optical products, including cameras, camcorders, photocopiers, steppers, computer printers, and medical equipment. Headquartered in Tokyo, Japan, Canon operates across various sectors, such as consumer imaging, office equipment, industrial products, and healthcare, providing innovative solutions and services to enhance the quality and functionality of imaging technology.

How the Company Makes Money

Canon Inc. generates revenue through multiple streams, primarily driven by its diverse product portfolio. The company's key revenue streams include the sale of cameras and imaging products, which cater to both consumer and professional markets; the office business unit, which provides multifunction devices, printers, and related services; and the medical systems segment, offering diagnostic imaging solutions and healthcare technologies. Canon also earns income from its industrial products segment, which produces semiconductor and flat-panel display equipment. Additionally, the company benefits from strategic partnerships and collaborations that enhance its technological capabilities and market reach, as well as after-sales services and consumables, such as printer cartridges, which provide steady recurring revenue.

Canon Inc. Financial Statement Overview

Summary

Canon Inc. exhibits a strong financial position with commendable profitability and cash flow generation capabilities. The income statement shows solid growth and profitability, while the balance sheet reflects stability with low leverage. Despite slight concerns over operational efficiency and capital stability, the company's overall financial health remains positive, supporting its competitive stance in the computer hardware industry.

Income Statement

Canon Inc. demonstrates strong profitability with a solid gross profit margin of 47.3% and a net profit margin of 3.8% on a TTM basis. Revenue growth rate improved to 6.5% in the latest period, indicating positive momentum. EBIT and EBITDA margins reflect stable operational efficiency. However, the declining EBIT margin over recent years suggests potential operational challenges.

Balance Sheet

The balance sheet of Canon Inc. is robust with a solid equity ratio of 54.7%. The debt-to-equity ratio remains manageable at 0.32, indicating a conservative leverage approach. Return on equity stands at 5.4%, reflecting moderate returns to shareholders. However, a slight decrease in stockholder's equity raises a cautionary note regarding long-term capital stability.

Cash Flow

Canon Inc.'s cash flow performance is impressive with a high operating cash flow to net income ratio of 3.49, indicating strong cash generation relative to profits. Free cash flow growth rate is modest at -1.08%, yet the free cash flow to net income ratio remains healthy at 2.12. The company's ability to generate cash flow efficiently supports its operations and potential investments.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
4.58T	4.51T	4.18T	4.03T	3.51T	3.16T
	Gross Profit
2.17T	2.14T	1.97T	1.83T	1.63T	1.38T
	EBIT
296.19B	279.75B	375.37B	353.40B	281.92B	110.55B
	EBITDA
691.06B	540.37B	631.71B	579.98B	524.60B	358.96B
	Net Income Common Stockholders
172.31B	160.03B	264.51B	243.96B	214.72B	83.32B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
701.92B	506.34B	405.14B	373.01B	404.77B	407.75B
	Total Assets
5.87T	5.77T	5.42T	5.10T	4.75T	4.63T
	Total Debt
1.02T	663.50B	517.32B	417.41B	320.97B	506.17B
	Net Debt
327.16B	161.94B	115.99B	55.31B	-80.42B	98.49B
	Total Liabilities
2.39T	2.12T	1.81T	1.75T	1.65T	1.84T
	Stockholders Equity
3.22T	3.38T	3.35T	3.11T	2.87T	2.58T
Cash Flow		Free Cash Flow
365.85B	369.83B	220.88B	74.08B	273.68B	169.09B
	Operating Cash Flow
601.55B	606.83B	451.19B	262.60B	451.03B	333.81B
	Investing Cash Flow
-261.64B	-297.32B	-275.37B	-180.82B	-207.26B	-155.44B
	Financing Cash Flow
-144.36B	-226.00B	-156.73B	-146.84B	-267.37B	-183.45B

Canon Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4290.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7751, the sentiment is Negative. The current price of 4290 is below the 20-day moving average (MA) of 4468.85, below the 50-day MA of 4439.68, and below the 200-day MA of 4795.68, indicating a bearish trend. The MACD of -42.34 indicates Positive momentum. The RSI at 39.47 is Neutral, neither overbought nor oversold. The STOCH value of 7.25 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:7751.

Canon Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7739	75 Outperform	¥109.14B	15.00		2.62%	8.95%	4.60%
6727	74 Outperform	$83.01B	16.61	15.32%	3.31%	-2.62%	26.11%
6588	71 Outperform	€158.83B	5.10	30.22%	1.61%	5.27%	―
6737	71 Outperform	¥86.76B	20.23		5.10%	0.03%	-23.96%
7751	70 Outperform	¥4.16T	24.08		3.61%	9.08%	-33.61%
6724	70 Neutral	$590.20B	10.93	6.70%	4.12%	3.72%	6.31%
Sector *	62 Neutral	$11.75B	10.58	-7.10%	2.91%	7.47%	-7.95%