Mitsubishi Heavy Industries (TSE:7011) Valuation in Focus After Raised Guidance and Dividend Upgrade

Mitsubishi Heavy Industries (TSE:7011) released an updated earnings forecast for the fiscal year ending March 2026, raising its revenue outlook following a solid first half of results. The company also increased its second quarter dividend.

See our latest analysis for Mitsubishi Heavy Industries.

After a rapid ascent earlier this year, Mitsubishi Heavy Industries' share price has taken a breather in recent weeks. However, momentum remains robust, with a remarkable 88% year-to-date share price return and strong interest following its upgraded outlook and recent sustainability partnerships. Its one-year total shareholder return of 82% also highlights the broad-based gains for investors and confirms that enthusiasm for the group's long-term transformation is still building.

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With shares up sharply and optimism running high after recent upgrades, the big question is whether Mitsubishi Heavy Industries is still undervalued, or if the market has already fully priced in its future growth prospects.

Most Popular Narrative: 5.5% Overvalued

The latest narrative puts Mitsubishi Heavy Industries’ fair value below the last close price, raising questions about whether further gains are supported by core fundamentals. Major factors shaping this perspective include sustained global energy demand shifts and a fortress-like order backlog that could secure revenue stability for years.

Order backlog growth to a record-high ¥10.77 trillion, with continued strong order intake in Energy Systems and infrastructure replacement projects, points to sustained multi-year revenue visibility as governments and corporations accelerate clean energy and infrastructure spending worldwide.

Read the complete narrative.

Curious what assumptions are fueling this rich premium? The narrative is not just about stable demand. It hinges on robust expansion, surging backlogs, and a future profit margin that few industrial giants dare target. Find out which bold forecasts could tip this story further in either direction.

Result: Fair Value of ¥4,001 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent foreign exchange swings or slowing defense orders could quickly undermine the outlook. This could reduce revenue predictability and challenge Mitsubishi Heavy Industries' growth story.

Find out about the key risks to this Mitsubishi Heavy Industries narrative.

Build Your Own Mitsubishi Heavy Industries Narrative

If you see the story differently, or want to chart your own conclusions using the available numbers, you can build a personalized narrative in just minutes, all your own. Do it your way

A great starting point for your Mitsubishi Heavy Industries research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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