Fact based stock research
Hitachi Zosen (TSE:7004)

JP3789000001

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

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Hitachi Zosen stock research in summary

hitachizosen.co.jp

ANALYSIS: With an Obermatt Combined Rank of 76 (better than 76% compared with investment alternatives), Hitachi Zosen (Industrial Machinery, Japan) shares have much better financial characteristics than comparable stocks. Shares of Hitachi Zosen are a good value (attractively priced) with a consolidated Value Rank of 89 (better than 89% of alternatives), show above-average growth (Growth Rank of 51) but are riskily financed (Safety Rank of 42), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 76, is a strong buy recommendation based on Hitachi Zosen's financial characteristics. As the company Hitachi Zosen's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 89) and above-average growth (Obermatt Growth Rank of 51), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 42) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	89
Growth Rank	51
Safety Rank	42
Combined Rank	76

Country	Japan
Industry	Industrial Machinery
Index	Nikkei 225
Size class	X-Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Hitachi Zosen

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	84	65	69	89
GROWTH
GROWTH	36	39	21	51
SAFETY
SAFETY	5	37	54	42
SENTIMENT
SENTIMENT	n/a	88	65	^new
360° VIEW
360° VIEW	n/a	71	56	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Hitachi Zosen is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	84	65	69	89
GROWTH
GROWTH	36	39	21	51
SAFETY
SAFETY	5	37	54	42
COMBINED
COMBINED	30	43	40	76

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Hitachi Zosen the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 89 (better than 89% compared with alternatives) for 2024, Hitachi Zosen shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Hitachi Zosen. Price-to-Sales is 97 which means that the stock price compared with what market professionals expect for future sales is lower than for 97% of comparable companies, indicating a good value for Hitachi Zosen's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 97% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 76. Compared with other companies in the same industry, dividend yields of Hitachi Zosen are expected to be higher than for 61% of all competitors (a Dividend Yield rank of 61). ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 89, is a buy recommendation based on Hitachi Zosen's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Hitachi Zosen based on its detailed value metrics. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	100	91	93	97
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	35	55	78	97
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	92	73	79	76
DIVIDEND YIELD
DIVIDEND YIELD	62	45	42	61
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	84	65	69	89

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Hitachi Zosen; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 51 (better than 51% compared with alternatives), Hitachi Zosen shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Hitachi Zosen. Capital Growth has a rank of 65, which means that currently professionals expect the company to grow its invested capital more than 28% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 61 (above 61% of alternative investments). But Sales Growth has only a rank of 49, which means that, currently, professionals expect the company to grow less than 51% of its competitors, and Profit Growth is also low at a rank of 28. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 51, is a buy recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for Hitachi Zosen, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	11	23	50	49
PROFIT GROWTH
PROFIT GROWTH	1	69	31	28
CAPITAL GROWTH
CAPITAL GROWTH	n/a	19	37	65
STOCK RETURNS
STOCK RETURNS	90	87	37	61
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	36	39	21	51

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Hitachi Zosen.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 42 (better than 42% compared with alternatives), the company Hitachi Zosen has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Hitachi Zosen is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for Hitachi Zosen. Refinancing is at 51, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 51% of its competitors. Liquidity is also good at 58, meaning the company generates more profit to service its debt than 58% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 20, which means the company has an above-average debt-to-equity ratio. It has more debt than 80% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 42 (worse than 58% compared with alternatives), Hitachi Zosen has a financing structure that is riskier than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Hitachi Zosen could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with Hitachi Zosen and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	22	16	26	20
REFINANCING
REFINANCING	6	55	67	51
LIQUIDITY
LIQUIDITY	40	47	50	58
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	5	37	54	42

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Hitachi Zosen and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	87	63	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	79	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	92	76	^new
MARKET PULSE
MARKET PULSE	n/a	5	11	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	88	65	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Hitachi Zosen.
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