Howmet Aerospace Inc. (HWM), based in Pittsburgh, Pennsylvania, with a market cap of $34.1 billion, operates in the aerospace and transportation industries, providing advanced engineered solutions worldwide. The company functions through four segments: Engine Products; Fastening Systems; Engineered Structures; and Forged Wheels.
Shares of Howmet Aerospace have significantly outperformed the broader market over the past 52 weeks. HWM has gained 86.2% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 26.6%. Moreover, in 2024, shares of HWM are up 54.2%, easily dwarfing SPX's 11.3% gains on a YTD basis.
Zooming in further, HWM has also outpaced the US Aerospace & Defense iShares ETF's (ITA) 20.9% gains over the past 52 weeks and a 7.9% increase on a YTD basis.
Howmet Aerospace's relative outperformance is fueled by several key factors, including heightened geopolitical tensions, booming travel demand, and increasing appetite for the company’s engine products and fastening systems.
Despite Boeing 737 Max 9 concerns, HWM stock jumped nearly 15.5% on May 2 after surpassing Q1 expectations. Also, the company's upward revision of its full-year 2024 guidance and indication of a substantial dividend increase further contributed to this positive market sentiment.
For the current fiscal year, ending in December, analysts expect HWM's EPS to grow by 29.9% to $2.39. The company’s earnings surprise history is promising. It holds a solid track record of consistently beating consensus estimates in each of the last four quarters.
Plus, Wall Street analysts are highly bullish on the stock. Among the 19 analysts covering the stock, the consensus rating is a “Strong Buy.” That’s based on 16 “Strong Buy” ratings, one “Moderate Buy,” and two “Holds.”
This configuration is slightly more bullish than three months before, with 15 analysts suggesting a "Strong Buy."
On May 17, Wells Fargo & Company (WFC) analyst Matthew Akers maintained a "Buy" rating on Howmet Aerospace with a price target of $88, implying an upside potential of 5.4% from current levels.
The stock is currently trading at a premium to the mean price target of $81.78. The Street-high price target of $100 implies a potential upside of 19.8% from the current price levels.
On the date of publication, Anushka Mukherjee 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.
