Hon Hai Precision Industry (HNHPF) AI Stock Analysis

• Market Cap: $64.39B
• Dividend Yield: 2.58%
• Average Volume (3M): 2.81K
• Price to Earnings (P/E): 13.6
• Beta (1Y): 0.99
• Revenue Growth: 8.06%
• EPS Growth: 4.69%
• Country: US
• Employees: 826,608
• Sector: Technology
• Sector Strength: 44
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 0.68
• Shares Outstanding: 6,945,851,000
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 2,812
• PEG Ratio: 2.89
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• Price to Cash Flow (P/CF): N/A
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

Hon Hai Precision Industry shows strong financial performance, driven by revenue growth and operational efficiency. However, technical indicators suggest bearish market momentum, with downward pressure on the stock price. The valuation is fair, but the dividend yield is modest. Improving cash flow management and monitoring market trends are crucial for enhancing the stock's performance.

Hon Hai Precision Industry Business Overview & Revenue Model

Company Description

Hon Hai Precision Industry Co., Ltd. provides technology solutions in Japan, Ireland, the United States, Singapore, China, Taiwan, and internationally. The company manufactures, sells, and services connectors, cases, thermal modules, wired/wireless communication products, optical products, power supply modules, and assemblies for use in the information technology, communications, automotive equipment, precision molding, automobile, and consumer electronics industries. It also manufactures and sells computer terminal monitors and related components, as well as data storage and processing equipment; offers solutions for autonomous driving systems, new energy power, and IoV systems; and provides services of planning, advisory, and business operation and management, logistics, export processing, construction, leasing, and information/software services. In addition, the company manufactures and sells application modules and network cables assemblies; develops educational technology; holds patent applications; manufactures and trades in portable cameras; and retails office machinery and equipment, and electronic appliances. Further, it is involved in the reinvestment in the businesses relating to robots, automatic equipment, molds, parts, and accessories and corresponding services; and software development, repair and after-sale, and rental services of robots. Additionally, the company manufactures and sells computer and data processing equipment, WIFI cards and modules, CFTVs, DVRs, Bluetooth modules, set-top boxes, and optical network terminals. It is also involved in the provision of data storage services; manufacturing of wire or wireless communication; installation of computer and satellite TV channels; and provision of mobile phone services, as well as telecom-related business. The company was founded in 1974 and is headquartered in New Taipei City, Taiwan.

How the Company Makes Money

Hon Hai Precision Industry makes money primarily through its contract manufacturing services, which involve producing electronic devices and components for leading technology companies. Key revenue streams include manufacturing services for consumer electronics, such as smartphones, tablets, and computers, for clients like Apple, Sony, and Microsoft. The company also generates income from the production of components such as connectors, enclosures, and printed circuit boards. Significant partnerships with major technology companies and its ability to produce at scale contribute to its earnings, allowing it to maintain competitive pricing and secure large-volume contracts.

Hon Hai Precision Industry Financial Statement Overview

Summary

Hon Hai Precision Industry demonstrates strong financial health with robust profitability, steady revenue growth, and a sound balance sheet. However, challenges in free cash flow generation need attention.

Income Statement

The company exhibits strong profitability with a solid gross profit margin of 6.25% and an impressive net profit margin of 2.42% for the TTM. Revenue growth is stable with a 6.8% increase from the previous year, indicating healthy top-line expansion. The EBIT margin stands at 1.98%, showing operational efficiency, while the EBITDA margin of 4.35% reflects good earnings performance before interest, taxes, depreciation, and amortization.

Balance Sheet

Hon Hai Precision Industry maintains a solid balance sheet with a debt-to-equity ratio of 0.58, indicating manageable leverage. The return on equity (ROE) is robust at 9.99%, demonstrating efficient use of shareholder funds. The equity ratio of 37.37% highlights a substantial proportion of equity financing, providing a cushion against liabilities.

Cash Flow

The cash flow analysis shows a decline in free cash flow from the previous year, with a negative growth rate of -94.94%, signaling potential challenges in cash generation. However, the operating cash flow to net income ratio is healthy at 1.02, indicating strong cash conversion. The free cash flow to net income ratio is 0.10, suggesting limited free cash flow relative to net income.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
6.58T	6.16T	6.63T	5.99T	5.36T	5.34T
	Gross Profit
411.18B	387.95B	400.09B	362.13B	302.92B	315.87B
	EBIT
130.29B	166.53B	222.25B	215.53B	185.79B	230.48B
	EBITDA
286.16B	236.79B	298.71B	291.01B	250.90B	297.49B
	Net Income Common Stockholders
159.52B	142.10B	141.48B	139.32B	101.79B	115.31B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
872.62B	1.35T	1.08T	1.11T	1.28T	913.77B
	Total Assets
3.38T	3.94T	4.13T	3.91T	3.67T	3.32T
	Total Debt
766.88B	943.07B	974.01B	871.55B	748.26B	656.48B
	Net Debt
-21.79B	-254.59B	-88.32B	-187.87B	-484.54B	-201.38B
	Total Liabilities
2.05T	2.25T	2.48T	2.34T	2.20T	1.92T
	Stockholders Equity
1.21T	1.49T	1.45T	1.38T	1.30T	1.24T
Cash Flow		Free Cash Flow
16.53B	326.60B	8.05B	-192.71B	310.09B	170.01B
	Operating Cash Flow
163.00B	445.55B	109.71B	-98.21B	377.62B	248.02B
	Investing Cash Flow
-367.95B	-137.87B	-45.44B	-92.08B	34.59B	70.58B
	Financing Cash Flow
-206.83B	-160.64B	-87.87B	24.28B	-25.12B	-218.10B

Hon Hai Precision Industry Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 9.29
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HNHPF, the sentiment is Negative. The current price of 9.29 is below the 20-day moving average (MA) of 10.07, below the 50-day MA of 10.52, and below the 200-day MA of 11.64, indicating a bearish trend. The MACD of -0.35 indicates Positive momentum. The RSI at 23.11 is Positive, neither overbought nor oversold. The STOCH value of -0.16 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HNHPF.

Hon Hai Precision Industry Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FLEX	78 Outperform	$12.71B	13.43	18.45%	―	-12.94%	47.70%
SANM	74 Outperform	$4.16B	18.74	10.55%	―	-8.92%	-12.11%
JBL	63 Neutral	$14.90B	32.54	24.10%	0.23%	-14.45%	-64.32%
HNHPF	62 Neutral	$64.39B	13.56	9.60%	2.58%	8.06%	4.69%
TTMI	61 Neutral	$2.12B	37.88	3.66%	―	9.41%	―
Sector *	57 Neutral	$20.97B	10.32	-14.01%	2.49%	4.46%	-23.38%