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Howmet Aerospace Inc. (HWM), headquartered in Pittsburgh, Pennsylvania, provides advanced engineered solutions for the aerospace and transportation industries. Valued at $33.61 billion by market cap, the company offers engines, fasteners, and structures, as well as forged wheels. The engineered metal products maker is expected to announce its fiscal second-quarter earnings for 2024 before the market opens on Tuesday, Jul. 30.
Ahead of the event, analysts expect HWM to report a profit of $0.60 per share on a diluted basis, up 36.4% from $0.44 per share in the year-ago quarter. The company has consistently surpassed Wall Street’s EPS estimates in its last four quarterly reports. During the previous quarter, HWM repurchased $150 million of common stock and paid a quarterly dividend of $0.05 per share on its common stock.
For the full year, analysts expect HWM to report EPS of $2.39, up 29.9% from $1.84 in fiscal 2023.
HWM stock has significantly outperformed the S&P 500’s ($SPX) 19.2% gains over the past 52 weeks, with shares up 62.3% during this period. Similarly, it outshined the S&P 500 Industrial Sector SPDR’s (XLI) 14% gains over the same time frame.
HWM’s overall performance can be attributed to Boeing's production slowdown, which has increased the utilization of older planes and resulted in higher demand for aftermarket services. The company has also benefited from factors such as geopolitical tensions, booming travel demand supporting record aircraft OEM backlogs, and increased demand for their engine products and fastening systems. Its defense-based revenue rose by 12% year over year, and investors believe the ongoing aerospace recovery and strength of defense orders would fuel HWM’s growth.
On Jun. 14, HWM shares closed down more than 4% after equity research firm Northcoast Research downgraded the stock to Sell from Neutral with a price target of $70.
On May 2, HWM shares soared more than 13% after reporting Q1 results. Its adjusted EPS of $0.57 surpassed Wall Street expectations of $0.52. The company’s revenue was $1.82 billion, topping Wall Street forecasts of $1.74 billion. For Q2, HWM expects its adjusted EPS to be between $0.57 and $0.59. The company expects revenue to be between $1.83 billion and $1.85 billion.
HWM expects full-year adjusted EPS in the range of $2.31 to $2.39, and it raised revenue forecast from its previous forecast of between $7 billion to $7.20 billion to now between $7.23 billion and $7.38 billion, stronger than the consensus estimates of $7.15 billion. Since its Q1 results were reported, HWM shares have been on an uptrend.
Analysts’ consensus opinion on HWM stock is bullish, with a “Strong Buy” rating overall. Out of 20 analysts covering the stock, 17 advise a “Strong Buy” rating, one suggests a “Moderate Buy” rating, one gives a “Hold” rating, and one recommends a “Strong Sell.” The average analyst price target for HWM is $86.95, indicating a potential upside of 5.6% from the current levels.
On the date of publication, Dipanjan Banchur did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
