Skip to Content

Hitachi Construction Machinery Co Ltd 6305

Morningstar Rating
JPY 4,785.00 −40.00 (0.83%)
View Full Chart
Unlock our analysis with Morningstar Investor

Company Report

Expect Hitachi Construction Machinery's Profitability to Improve From Growth of Value Chain Business

As a construction/mining machinery manufacturer, Hitachi Construction Machinery’s, or HCM’s, lifeline will be from sales of its mainstay hydraulic excavators, mining dump trucks, and wheel loaders. However, the company’s core strategy will focus on growing its “value chain” business, which includes services like spare parts supply and maintenance. As its product sales increase through both direct channels and dealers, the company can provide more aftermarket services. Further, more of HCM’s machines will be included its ConSite system, which allows the monitoring of the equipment’s operational status and if issues are detected, HCM can provide preventative/corrective measures. These services provide significant value for the end-users and are highly profitable.

Price vs Fair Value

6305 is trading at a 11% discount.
Price
JPY 4,825.00
Fair Value
JPY 1,736.00
Uncertainty
Medium
1-Star Price
JPY 6,332.80
5-Star Price
JPY 5,555.00
Economic Moat
Klhrdn
Capital Allocation
Bvwlrtbs

Bulls Say, Bears Say

Bulls

Increased mining and parts sales will lead to a material improvement in operating margins.

Bears

Declining commodities demand can lead to weaker profitability from lower mining machinery sales.

Is it the right time to buy, sell, or hold?
Start a free trial of Morningstar Investor to unlock exclusive ratings and continuous analyst coverage to help you decide if 6305 is a good fit for your portfolio.

Trading Information

Previous Close Price
JPY 4,825.00
Day Range
JPY 4,716.004,791.00
52-Week Range
JPY 3,050.004,927.00
Bid/Ask
JPY 4,783.00 / JPY 4,786.00
Market Cap
JPY 1.02 Tril
Volume/Avg
229,800 / 963,640

Key Statistics

Price/Earnings (Normalized)
9.13
Price/Sales
0.72
Dividend Yield (Trailing)
3.05%
Dividend Yield (Forward)
3.57%
Total Yield
3.05%

Company Profile

Hitachi Construction Machinery, or HCM, manufactures and sells construction and mining machinery, and provides related services such as parts supply, rentals, and others. HCM was established in 1970 as a subsidiary of Hitachi, but its origins date back to 1949 when it introduced Japan’s first mechanical excavator. The company’s main products include hydraulic excavators for mining/construction, rigid dump trucks, and wheel loaders. As of August 2022, Hitachi is no longer the parent company of HCM, after selling 26% of its stake to HCJI Holdings, a joint venture between Itochu and Japan Industrial Partners. Currently, Hitachi has a 25.4% stake in Hitachi Construction Machinery as an equity-method affiliate. HCM is based in Tokyo, Japan.
Sector
Industrials
Industry
Farm & Heavy Construction Machinery
Stock Style Box
Mid Core
Total Number of Employees
27,697

Competitors

Valuation

Metric
6305
CAT
DE
Price/Earnings (Normalized)
9.1317.5311.98
Price/Book Value
1.409.535.19
Price/Sales
0.722.851.99
Price/Cash Flow
7.3615.0010.07
Price/Earnings
6305
CAT
DE

Financial Strength

Metric
6305
CAT
DE
Quick Ratio
0.590.741.81
Current Ratio
1.441.352.05
Interest Coverage
7.3525.575.59
Quick Ratio
6305
CAT
DE

Profitability

Metric
6305
CAT
DE
Return on Assets (Normalized)
6.07%12.80%9.82%
Return on Equity (Normalized)
14.90%59.03%44.28%
Return on Invested Capital (Normalized)
8.57%19.53%14.47%
Return on Assets
6305
CAT
DE
See how this stock stacks up to its competitors with Morningstar Investor

Farm & Heavy Construction Machinery Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
CAT
Caterpillar IncKbzkpsrTvtq$185.7 Bil
DE
Deere & CoKkhpmpmpfJbpf$114.9 Bil
PCAR
PACCAR IncHkpyhzghYhsqlh$61.9 Bil
VOLAF
Volvo AB Class AKrq$56.5 Bil
VLVLY
Volvo AB ADRBrkv$54.2 Bil
VOLVF
Volvo AB Class BLyzp$54.0 Bil
CNHI
CNH Industrial NVWcvkswnmhJdgddhg$15.7 Bil
AGCO
AGCO CorpZwhhgmmlfJyqzw$9.4 Bil
OSK
Oshkosh CorpYmrlbgqfNrggptc$8.1 Bil
TEX
Terex CorpBkbwfsdvVdthrj$4.4 Bil

Sponsor Center