Canon Inc. (7751) AI Stock Analysis

• Market Cap: ¥3.86T
• Dividend Yield: 5.75%
• Average Volume (3M): 2.95M
• Price to Earnings (P/E): 22.4
• Beta (1Y): 0.71
• Revenue Growth: 9.08%
• EPS Growth: -33.61%
• Country: JP
• Employees: 111,733
• Sector: Technology
• Sector Strength: 93
• Industry: Computer Hardware
• EPS (TTM): 77.27
• Shares Outstanding: 1,333,763,400
• 10 Day Avg. Volume: 2,974,710
• 30 Day Avg. Volume: 2,954,616
• PEG Ratio: 2.12
• Price to Book (P/B): 1.16
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 10.10
• 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: ¥4,383.33
• Price Target Upside: 9.56% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 3

• Rating: 70 Outperform
• Price Target: ¥5,151.00 ▲(28.74%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. (7751) is a Japanese multinational corporation specializing in the manufacture of imaging and optical products, including cameras, camcorders, printers, and medical equipment. Founded in 1937 and headquartered in Tokyo, Japan, Canon operates through several segments, including Office Business Unit, Imaging System Business Unit, Medical System Business Unit, and Industry and Others. The company is renowned for its high-quality imaging and optical products, serving both consumer and professional markets worldwide.

How the Company Makes Money

Canon Inc. generates revenue through the sale of its diverse range of products across its various business segments. The Office Business Unit is a significant revenue stream, driven by the sale of office multifunction devices, laser printers, and other office solutions. The Imaging System Business Unit contributes through digital cameras, camcorders, and inkjet printers. The Medical System Business Unit provides medical imaging products and solutions, including diagnostic equipment, which is another key revenue source. Additionally, Canon's Industry and Others segment includes semiconductor lithography equipment and other industrial products. Canon also benefits from aftermarket sales such as consumables, service, and maintenance contracts. Strategic partnerships and collaborations in areas like medical equipment and industrial technologies further bolster its financial performance.

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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.51T	4.18T	4.03T	3.51T	3.16T
Gross Profit	2.14T	1.97T	1.83T	1.63T	1.38T
EBITDA	540.37B	631.71B	579.98B	524.60B	358.96B
Net Income	160.03B	264.51B	243.96B	214.72B	83.32B
Balance Sheet
Total Assets	5.77T	5.42T	5.10T	4.75T	4.63T
Cash, Cash Equivalents and Short-Term Investments	506.34B	405.14B	373.01B	404.77B	407.75B
Total Debt	663.50B	517.32B	417.41B	320.97B	506.17B
Total Liabilities	2.12T	1.81T	1.75T	1.65T	1.84T
Stockholders Equity	3.38T	3.35T	3.11T	2.87T	2.58T
Cash Flow
Free Cash Flow	369.83B	220.88B	74.08B	273.68B	169.09B
Operating Cash Flow	606.83B	451.19B	262.60B	451.03B	333.81B
Investing Cash Flow	-297.32B	-275.37B	-180.82B	-207.26B	-155.44B
Financing Cash Flow	-226.00B	-156.73B	-146.84B	-267.37B	-183.45B

Canon Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4001.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 4001 is below the 20-day moving average (MA) of 4088.18, below the 50-day MA of 4215.98, and below the 200-day MA of 4617.53, indicating a bearish trend. The MACD of -57.04 indicates Positive momentum. The RSI at 37.34 is Neutral, neither overbought nor oversold. The STOCH value of 24.11 is Neutral, 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
6727	76 Outperform	$91.00B	18.47	15.32%	6.15%	-2.62%	24.89%
7739	75 Outperform	¥101.29B	13.92		4.24%	8.95%	4.60%
6588	73 Outperform	€163.61B	5.26	30.22%	2.35%	5.27%	―
6724	72 Outperform	¥596.28B	11.04	6.70%	5.96%	3.72%	6.12%
6737	71 Outperform	¥91.14B	21.25		12.02%	0.03%	-23.96%
7751	70 Outperform	¥3.86T	22.35		5.75%	9.08%	-33.61%
Sector *	57 Neutral	$887.18M	11.49	-16.27%	3.23%	10.48%	-33.33%