Mitsubishi Heavy Industries: F3/26 4Q Results: Accelerating Improvement in Energy Profit Margin

Research evidence excerpt

Mitsubishi Heavy Industries: F3/26 4Q Results: Accelerating Improvement in Energy Profit Margin

Update

May 12, 2026 10:35 AM GMT

Morgan Stanley MUFG Securities Co., Ltd.+MMitsubishi Heavy Industries (7011) | Japan Takeshi Kitaura

Equity Analyst

F3/26 4Q Results: Accelerating Takeshi.Kitaura@morganstanleymufg.comMorgan Stanley Asia Limited+ +81 3 6836-5427

Lisa Jiang

Equity AnalystImprovement in Energy Profit Lisa.Jiang1@morganstanley.com +852 2239-1282

Morgan Stanley MUFG Securities Co., Ltd.+Margin Daisuke Horiuchi

Research Associate

Daisuke.Horiuchi@morganstanleymufg.com +81 3 6836-5428

Reaction to earnings

Unchanged Modest upside Modest revision higher Mitsubishi Heavy Industries (7011.T, 7011 JT)

Impact to our thesis Financial results versus consensus Direction of next 12-month Heavy Industries | Japan

consensus EPS

Stock Rating Overweight

Source: Company data, Morgan Stanley Research Industry View Attractive

Price target ¥5,500

Shr price, close (May 12, 2026) ¥4,300

Key Takeaways Mkt cap, curr, basic (bn) ¥14,449.5

Avg daily trading value (bn) ¥132.1

The impression of F3/27 BP guidance is healthy, somewhat higher than consensus

excluding a ¥20bn buffer.

We think the short share price fall after the results release presents an entry

point.

Gas turbine orders came to 35 units (16GGW) in F3/26 and the backlog was 74

units (33GW); outstanding orders in Energy grew to 3.4x of F3/26 sales.

The F3/27 BP plan has the Energy margin at 15.5%, above our 14% forecast, and

16.4% excl. the buffer, with prospects of further improvement in F3/28 as well.

The ¥1.4trn order plan for Aircraft, Defense & Space looks to a fall vs. F3/26 but

this reflects booking of frigate orders last year.

Company plan: We expected business profit guidance well below our forecast but