Kawasaki Heavy Industries Ltd. (7012) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

Nippon Avionics Co., Ltd.

Mitsubishi Heavy Industries, Ltd.

Kawasaki Heavy Industries Ltd.

ShinMaywa Industries, Ltd.

Tokyo Keiki, Inc.

Asahi-Seiki Manufacturing Co., Ltd.

ACSL Ltd.

ispace, Inc.

Hosoya Pyro-Engineering Co., Ltd.

Miroku Corp.

JAMCO Corp.

Why is Kawasaki Heavy Industries Ltd. ?

Poor Management Efficiency with a low ROCE of 4.48%

The company has been able to generate a Return on Capital Employed (avg) of 4.48% signifying low profitability per unit of total capital (equity and debt)

High Debt Company with a Debt to Equity ratio (avg) at times

Poor long term growth as Net Sales has grown by an annual rate of 5.34% over the last 5 years
High Debt Company with a Debt to Equity ratio (avg) at times
The company has been able to generate a Return on Equity (avg) of 5.79% signifying low profitability per unit of shareholders funds

Positive results in Dec 25

OPERATING CASH FLOW(Y) Highest at JPY 146,543 MM
NET PROFIT(HY) At JPY 61,609 MM has Grown at 114.02%
ROCE(HY) Highest at 14.87%

With ROCE of 8.53%, it has a attractive valuation with a 1.72 Enterprise value to Capital Employed

The stock is trading at a premium compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of 58.01%, its profits have risen by 230.8% ; the PEG ratio of the company is 0.1
At the current price, the company has a high dividend yield of 0

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Kawasaki Heavy Industries Ltd. should be less than 10%
Overall Portfolio exposure to Aerospace & Defense should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Aerospace & Defense)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Kawasaki Heavy Industries Ltd. for you?

High Risk, High Return

Absolute

Risk Adjusted

Volatility

Kawasaki Heavy Industries Ltd.

58.01%

1167.98

58.07%

Japan Nikkei 225

36.73%

1.30

28.24%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

5.34%

EBIT Growth (5y)

14.95%

EBIT to Interest (avg)

4.54

Debt to EBITDA (avg)

5.11

Net Debt to Equity (avg)

1.08

Sales to Capital Employed (avg)

1.27

Tax Ratio

20.38%

Dividend Payout Ratio

28.55%

Pledged Shares

Institutional Holding

0.00%

ROCE (avg)

4.54%

ROE (avg)

5.79%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

2.49

EV to EBIT

20.10

EV to EBITDA

11.49

EV to Capital Employed

1.72

EV to Sales

1.18

PEG Ratio

0.08

Dividend Yield

0.00%

ROCE (Latest)

8.53%

ROE (Latest)

12.85%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

RSI

No Signal

Bollinger Bands

Mildly Bullish

Moving Averages

Mildly Bullish (Daily)

KST

Bullish

Dow Theory

Mildly Bearish

Bullish

OBV

No Trend

Mildly Bullish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

10What is working for the Company

OPERATING CASH FLOW(Y)

Highest at JPY 146,543 MM

NET PROFIT(HY)

At JPY 61,609 MM has Grown at 114.02%

ROCE(HY)

Highest at 14.87%

RAW MATERIAL COST(Y)

Fallen by -3.44% (YoY

OPERATING PROFIT MARGIN(Q)

Highest at 11.98 %

PRE-TAX PROFIT(Q)

Highest at JPY 47,753 MM

-5What is not working for the Company

INTEREST(Q)

At JPY 5,330 MM has Grown at 11.3%

DEBTORS TURNOVER RATIO(HY)

Lowest at 2.45 times

Here's what is working for Kawasaki Heavy Industries Ltd.

Operating Cash Flow

Highest at JPY 146,543 MM and Grown

In each year in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (JPY MM)

Net Profit

At JPY 61,609 MM has Grown at 114.02%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is positive

Net Profit (JPY MM)

Operating Profit Margin

Highest at 11.98 %

in the last five periods

MOJO Watch

Company's profit margin has improved

Operating Profit to Sales

Pre-Tax Profit

Highest at JPY 47,753 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (JPY MM)

Raw Material Cost

Fallen by -3.44% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Here's what is not working for Kawasaki Heavy Industries Ltd.

Interest

At JPY 5,330 MM has Grown at 11.3%

period on period (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (JPY MM)

Debtors Turnover Ratio

Lowest at 2.45 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio