Stock of the Day

May 26, 2021

Howmet Aerospace (HWM)

$129.83
-$8.61 (-6.2%)
Market Cap: $56.07B

About Howmet Aerospace

Howmet Aerospace Inc. provides advanced engineered solutions for the aerospace and transportation industries in the United States, Japan, France, Germany, the United Kingdom, Mexico, Italy, Canada, Poland, China, and internationally. It operates through four segments: Engine Products, Fastening Systems, Engineered Structures, and Forged Wheels. The Engine Products segment offers airfoils and seamless rolled rings primarily for aircraft engines and industrial gas turbines; and rotating and structural parts. The Fastening Systems segment produces aerospace fastening systems, as well as commercial transportation, industrial, and other fasteners; and latches, bearings, fluid fittings, and installation tools. The Engineered Structures segment provides titanium ingots and mill products, aluminum and nickel forgings, and machined components and assemblies for aerospace and defense applications; and titanium forgings, extrusions, and forming and machining services for airframe, wing, aero-engine, and landing gear components. The Forged Wheels segment offers forged aluminum wheels and related products for heavy-duty trucks and commercial transportation markets. The company was formerly known as Arconic Inc. Howmet Aerospace Inc. was founded in 1888 and is based in Pittsburgh, Pennsylvania.

Howmet Aerospace Bull Case

Here are some ways that investors could benefit from investing in Howmet Aerospace Inc.:

  • The stock is currently trading at $139.36, reflecting a strong performance and investor confidence in the company's growth potential.
  • Howmet Aerospace Inc. has recently increased its quarterly dividend from $0.08 to $0.10 per share, indicating a commitment to returning value to shareholders and a healthy dividend payout ratio of 14.18%.
  • Analysts have a consensus rating of "Moderate Buy" for the stock, with a target price of $123.28, suggesting that there is potential for price appreciation.
  • The company reported a net margin of 15.55% and a return on equity of 25.74%, showcasing strong profitability and efficient use of equity capital.
  • Recent upgrades from analysts, including target price increases from firms like Truist Financial and Barclays, highlight positive market sentiment and confidence in the company's future performance.

Howmet Aerospace Bear Case

Investors should be bearish about investing in Howmet Aerospace Inc. for these reasons:

  • Despite the positive outlook, one analyst has issued a sell rating, indicating that there are concerns about the stock's valuation or potential risks.
  • The company has a relatively high PE ratio of 49.42, which may suggest that the stock is overvalued compared to its earnings, potentially limiting future price appreciation.
  • Howmet Aerospace Inc. operates in a highly competitive aerospace and transportation industry, which can be affected by economic downturns and fluctuations in demand.
  • With 90.46% of the stock owned by institutional investors and hedge funds, retail investors may have less influence on stock price movements, which can lead to volatility.
  • The company's debt-to-equity ratio of 0.74 indicates a moderate level of debt, which could pose risks if interest rates rise or if the company faces financial challenges.

Recent News