Howmet Aerospace prepared to rocket higher Wednesday after the defense supplier cleared third-quarter earnings estimates. HWM stock is one of the top performers in the S&P 500 so far this year and rallied above a buying opportunity on results.
Howmet Aerospace reported a 54% increase in earnings to 71 cents per share adjusted, beating FactSet expectations of 65 cents per share. Revenue rose 11% to $1.84 billion, but came in short of views for $1.85 billion.
Howmet was Tuesday's IBD Stock Of The Day.
CEO John Plant in the release noted that the revenue growth included restricted volumes shipped to Boeing, along with weaker market conditions in Europe that impacted forged wheels products.
Strong Demand Outlook
"Turning to 2025, the demand outlook for commercial aerospace remains robust, driven by healthy air traffic growth," Plant said in the release. "The underproduction of aircraft in recent years has resulted in a very large order backlog which, combined with the significant needs for additional engine spare parts, is supportive of future revenue growth."
Howmet expects above-trend growth in commercial aerospace to continue in 2025, along with gains in its defense aerospace and industrial end markets. However, Howmet expects the commercial transportation end market will remain soft until the back half of 2025.
The company guided Q4 earnings between 70 cents and 72 cents per share, ahead of FactSet estimates for 69 cents. Howmet expects fourth-quarter revenue between $1.85 billion and $1.89 billion, in-line with estimates.
Howmet Aerospace lifted its 2024 earnings guidance to range from $2.65 to $2.67 per share. Its previous outlook called for $2.53 to $2.57 per share. The company forecasts 2024 revenue ranges from $7.39 billion to $7.43 billion, slightly lower from its prior guidance for $7.4 billion to $7.48 billion. FactSet expects 2024 earnings increase 40% to $2.59 per share on 12% revenue growth to $7.44 billion.
Plant noted that Howmet's 2025 outlook envisions about 7.5% year-over-year revenue growth.
Howmet Aerospace Stock
Howmet stock spiked 12.5% Wednesday to a new record high of 114.94.
Shares have bounced off their 50-day moving average and on Tuesday climbed above their 21-day exponential line, putting them in an early buy range.
HWM stock bolted more than 112% higher this year.
The advance has made it one of the best performers in the S&P 500, especially outside of artificial intelligence names.
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