Canon (TSE:7751) - Share price, News & Analysis

Q: What is the Fair Price of 7751 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

7751 (¥3413) is trading below our estimate of [[fair value]] (¥4479.3)

7751 fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	1/6
Past Performance	4/6
Financial Health	6/6
Dividends	2/6

7751 Stock Overview

Rewards

Trading at 23.8% below our estimate of its fair value

Earnings are forecast to grow 0.32% per year

Earnings grew by 21.8% over the past year

Risk Analysis

Dividend of 3.52% is not well covered by earnings

Canon Competitors

FUJIFILM Holdings

TSE:4901

JP¥3.0t

Seiko Epson

TSE:6724

JP¥750.5b

Ricoh Company

TSE:7752

JP¥673.9b

Brother Industries

TSE:6448

JP¥669.9b

Price History & Performance

Summary of all time highs, changes and price drops for Canon
Historical stock prices
Current Share Price	JP¥3,413.00
52 Week High	JP¥3,429.00
52 Week Low	JP¥2,467.00
Beta	0.54
1 Month Change	9.64%
3 Month Change	6.23%
1 Year Change	29.77%
3 Year Change	25.04%
5 Year Change	-10.23%
Change since IPO	253.07%

Shareholder Returns

	7751	JP Tech	JP Market
7D	0.9%	0.6%	2.5%
1Y	29.8%	1.8%	1.9%

Return vs Industry: 7751 exceeded the JP Tech industry which returned 3.9% over the past year.

Return vs Market: 7751 exceeded the JP Market which returned 2.5% over the past year.

Price Volatility

Is 7751's price volatile compared to industry and market?
7751 volatility
7751 Average Weekly Movement	2.8%
Tech Industry Average Movement	3.6%
Market Average Movement	3.8%
10% most volatile stocks in JP Market	7.8%
10% least volatile stocks in JP Market	2.0%

Stable Share Price: 7751 is not significantly more volatile than the rest of JP stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: 7751's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1933	184,034	Fujio Mitarai	https://global.canon

Canon Inc., together with its subsidiaries, manufactures and sells office multifunction devices (MFDs), plain paper copying machines, laser and inkjet printers, cameras, diagnostic equipment, and lithography equipment. The company operates through four segments: Printing Business Unit, Imaging Business Unit, Medical Business Unit, and Industrial and Others Business Unit. The Printing Business Unit segment offers office MFDs, document solutions, laser multifunction printers, laser printers, inkjet printers, image scanners, calculators, digital continuous feed presses, digital sheet-fed presses, and large format printers.

Canon Fundamentals Summary

How do Canon's earnings and revenue compare to its market cap?
7751 fundamental statistics
Market Cap	JP¥3.52t
Earnings (TTM)	JP¥214.12b
Revenue (TTM)	JP¥3.67t

16.4x

P/E Ratio

1.0x

P/S Ratio

Is 7751 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
7751 income statement (TTM)
Revenue	JP¥3.67t
Cost of Revenue	JP¥1.98t
Gross Profit	JP¥1.68t
Other Expenses	JP¥1.47t
Earnings	JP¥214.12b

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	207.85
Gross Margin	45.93%
Net Profit Margin	5.84%
Debt/Equity Ratio	9.4%

How did 7751 perform over the long term?

See historical performance and comparison

Dividends

3.5%

Current Dividend Yield

56%

Payout Ratio

Does 7751 pay a reliable dividends?

See 7751 dividend history and benchmarks

When do you need to buy 7751 by to receive an upcoming dividend?
Canon dividend dates
Ex Dividend Date	Dec 29 2022
Dividend Pay Date	Mar 31 2023
Days until Ex dividend	134 days
Days until Dividend pay date	226 days

Does 7751 pay a reliable dividends?

See 7751 dividend history and benchmarks

We’ve recently updated our valuation analysis.

Valuation

Is 7751 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 7751?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 7751. This is calculated by dividing 7751's market cap by their current preferred multiple.
What is 7751's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	JP¥3.52t

7751 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	1x
Enterprise Value/EBITDA	6.7x
PEG Ratio	51.1x

Price to Earnings Ratio vs Peers

How does 7751's PE Ratio compare to its peers?

7751 PE Ratio vs Peers

The above table shows the PE ratio for 7751 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	13.5x
4901 FUJIFILM Holdings	15.2x	8.2%	JP¥3.0t
6724 Seiko Epson	7.4x	2.7%	JP¥750.5b
7752 Ricoh Company	20.3x	13.9%	JP¥673.9b
6448 Brother Industries	11.2x	1.6%	JP¥669.9b
7751 Canon	16.4x	0.3%	JP¥3.5t

Price-To-Earnings vs Peers: 7751 is expensive based on its Price-To-Earnings Ratio (16.4x) compared to the peer average (13.5x).

Price to Earnings Ratio vs Industry

How does 7751's PE Ratio compare vs other companies in the JP Tech Industry?

Price-To-Earnings vs Industry: 7751 is expensive based on its Price-To-Earnings Ratio (16.4x) compared to the JP Tech industry average (11.3x)

Price to Earnings Ratio vs Fair Ratio

What is 7751's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

7751 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	16.4x
Fair PE Ratio	14.1x

Price-To-Earnings vs Fair Ratio: 7751 is expensive based on its Price-To-Earnings Ratio (16.4x) compared to the estimated Fair Price-To-Earnings Ratio (14.1x).

Share Price vs Fair Value

What is the Fair Price of 7751 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 7751 (¥3413) is trading below our estimate of fair value (¥4479.3)

Significantly Below Fair Value: 7751 is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.

Discover undervalued companies

Future Growth

How is Canon forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

0.3%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 7751's forecast earnings growth (0.3% per year) is above the savings rate (0.04%).

Earnings vs Market: 7751's earnings (0.3% per year) are forecast to grow slower than the JP market (8.6% per year).

High Growth Earnings: 7751's earnings are forecast to grow, but not significantly.

Revenue vs Market: 7751's revenue (1% per year) is forecast to grow slower than the JP market (4.3% per year).

High Growth Revenue: 7751's revenue (1% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 7751's Return on Equity is forecast to be low in 3 years time (8%).

Discover growth companies

Past Performance

How has Canon performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-8.4%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 7751 has high quality earnings.

Growing Profit Margin: 7751's current net profit margins (5.8%) are higher than last year (5.1%).

Past Earnings Growth Analysis

Earnings Trend: 7751's earnings have declined by 8.4% per year over the past 5 years.

Accelerating Growth: 7751's earnings growth over the past year (21.8%) exceeds its 5-year average (-8.4% per year).

Earnings vs Industry: 7751 earnings growth over the past year (21.8%) exceeded the Tech industry 15.8%.

Return on Equity

High ROE: 7751's Return on Equity (6.9%) is considered low.

Discover strong past performing companies

Financial Health

How is Canon's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: 7751's short term assets (¥2,173.8B) exceed its short term liabilities (¥1,178.8B).

Long Term Liabilities: 7751's short term assets (¥2,173.8B) exceed its long term liabilities (¥611.6B).

Debt to Equity History and Analysis

Debt Level: 7751 has more cash than its total debt.

Reducing Debt: 7751's debt to equity ratio has reduced from 21.4% to 9.4% over the past 5 years.

Debt Coverage: 7751's debt is well covered by operating cash flow (97.5%).

Interest Coverage: 7751 earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

Discover healthy companies

Dividend

What is Canon current dividend yield, its reliability and sustainability?

Dividend Score

2/6

Dividend Score 2/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

3.52%

Current Dividend Yield

Upcoming Dividend Payment

Dividend Yield vs Market

Notable Dividend: 7751's dividend (3.52%) is higher than the bottom 25% of dividend payers in the JP market (1.63%).

High Dividend: 7751's dividend (3.52%) is low compared to the top 25% of dividend payers in the JP market (3.61%).

Stability and Growth of Payments

Stable Dividend: 7751's dividend payments have been volatile in the past 10 years.

Growing Dividend: 7751's dividend payments have not increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (56%), 7751's dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (99.7%), 7751's dividend payments are not well covered by cash flows.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

3.3yrs

Average management tenure

CEO

Fujio Mitarai (87 yo)

26.92yrs

Tenure

JP¥457,000,000

Compensation

Mr. Fujio Mitarai has been the Chairman and Chief Executive Officer of Canon Inc. since March 31, 2006 and September 1995 respectively and served as its President and Chief Operating Officer since May 1,...

CEO Compensation Analysis

Compensation vs Market: Fujio's total compensation ($USD3.43M) is above average for companies of similar size in the JP market ($USD1.53M).

Compensation vs Earnings: Fujio's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: 7751's management team is considered experienced (3.3 years average tenure).

Board Members

Experienced Board: 7751's board of directors are considered experienced (4.9 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/16 00:00
End of Day Share Price	2022/08/16 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31