HOWMET AEROSPACE INC (HWM)
US4432011082 - Common Stock
HWM gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 65 industry peers in the Aerospace & Defense industry. Both the health and profitability get an excellent rating, making HWM a very profitable company, without any liquidiy or solvency issues. HWM has a correct valuation and a medium growth rate. With these ratings, HWM could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
HWM had positive earnings in the past year.
In the past year HWM had a positive cash flow from operations.
HWM had positive earnings in each of the past 5 years.
In the past 5 years HWM always reported a positive cash flow from operatings.
1.2 Ratios
HWM has a better Return On Assets (10.18%) than 89.23% of its industry peers.
HWM has a better Return On Equity (23.87%) than 93.85% of its industry peers.
The Return On Invested Capital of HWM (13.36%) is better than 93.85% of its industry peers.
The Average Return On Invested Capital over the past 3 years for HWM is in line with the industry average of 7.71%.
The 3 year average ROIC (9.00%) for HWM is below the current ROIC(13.36%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.18% | ||
| ROE | 23.87% | ||
| ROIC | 13.36% |
ROA(3y)4.79%
ROA(5y)3.86%
ROE(3y)13.06%
ROE(5y)11.32%
ROIC(3y)9%
ROIC(5y)8.04%
1.3 Margins
Looking at the Profit Margin, with a value of 14.79%, HWM belongs to the top of the industry, outperforming 92.31% of the companies in the same industry.
In the last couple of years the Profit Margin of HWM has grown nicely.
HWM's Operating Margin of 21.32% is amongst the best of the industry. HWM outperforms 96.92% of its industry peers.
HWM's Operating Margin has improved in the last couple of years.
HWM's Gross Margin of 30.40% is fine compared to the rest of the industry. HWM outperforms 72.31% of its industry peers.
HWM's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.32% | ||
| PM (TTM) | 14.79% | ||
| GM | 30.4% |
OM growth 3Y6.32%
OM growth 5Y5.94%
PM growth 3Y32.63%
PM growth 5Y4.01%
GM growth 3Y2.3%
GM growth 5Y2.75%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so HWM is still creating some value.
The number of shares outstanding for HWM has been reduced compared to 1 year ago.
The number of shares outstanding for HWM has been reduced compared to 5 years ago.
Compared to 1 year ago, HWM has an improved debt to assets ratio.
2.2 Solvency
HWM has an Altman-Z score of 6.47. This indicates that HWM is financially healthy and has little risk of bankruptcy at the moment.
HWM's Altman-Z score of 6.47 is amongst the best of the industry. HWM outperforms 83.08% of its industry peers.
HWM has a debt to FCF ratio of 3.39. This is a good value and a sign of high solvency as HWM would need 3.39 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.39, HWM belongs to the top of the industry, outperforming 81.54% of the companies in the same industry.
A Debt/Equity ratio of 0.75 indicates that HWM is somewhat dependend on debt financing.
HWM's Debt to Equity ratio of 0.75 is on the low side compared to the rest of the industry. HWM is outperformed by 66.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.75 | ||
| Debt/FCF | 3.39 | ||
| Altman-Z | 6.47 |
ROIC/WACC1.51
WACC8.82%
2.3 Liquidity
A Current Ratio of 2.24 indicates that HWM has no problem at all paying its short term obligations.
HWM has a Current ratio of 2.24. This is comparable to the rest of the industry: HWM outperforms 58.46% of its industry peers.
HWM has a Quick Ratio of 2.24. This is a bad value and indicates that HWM is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.98, HWM perfoms like the industry average, outperforming 43.08% of the companies in the same industry.
HWM does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.24 | ||
| Quick Ratio | 0.98 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 45.88% over the past year.
HWM shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.35% yearly.
Looking at the last year, HWM shows a quite strong growth in Revenue. The Revenue has grown by 13.20% in the last year.
Measured over the past years, HWM shows a decrease in Revenue. The Revenue has been decreasing by -0.41% on average per year.
EPS 1Y (TTM)45.88%
EPS 3Y23.59%
EPS 5Y6.35%
EPS Q2Q%54.35%
Revenue 1Y (TTM)13.2%
Revenue growth 3Y8.08%
Revenue growth 5Y-0.41%
Sales Q2Q%10.68%
3.2 Future
HWM is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 24.28% yearly.
Based on estimates for the next years, HWM will show a quite strong growth in Revenue. The Revenue will grow by 11.08% on average per year.
EPS Next Y43.39%
EPS Next 2Y30.86%
EPS Next 3Y27.57%
EPS Next 5Y24.28%
Revenue Next Year13.41%
Revenue Next 2Y10.79%
Revenue Next 3Y10.73%
Revenue Next 5Y11.08%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 47.17, which means the current valuation is very expensive for HWM.
HWM's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 28.96, HWM is valued quite expensively.
Based on the Price/Forward Earnings ratio of 36.93, the valuation of HWM can be described as expensive.
HWM's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 23.82. HWM is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 47.17 | ||
| Fwd PE | 36.93 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as HWM.
Based on the Price/Free Cash Flow ratio, HWM is valued a bit cheaper than the industry average as 61.54% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 47.43 | ||
| EV/EBITDA | 27.94 |
4.3 Compensation for Growth
HWM's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
HWM has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as HWM's earnings are expected to grow with 27.57% in the coming years.
PEG (NY)1.09
PEG (5Y)7.43
EPS Next 2Y30.86%
EPS Next 3Y27.57%
5. Dividend
5.1 Amount
With a yearly dividend of 0.28%, HWM is not a good candidate for dividend investing.
HWM's Dividend Yield is a higher than the industry average which is at 1.49.
With a Dividend Yield of 0.28, HWM pays less dividend than the S&P500 average, which is at 2.23.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.28% |
5.2 History
The dividend of HWM decreases each year by -6.38%.
HWM has been paying a dividend for at least 10 years, so it has a reliable track record.
HWM has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-6.38%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
9.02% of the earnings are spent on dividend by HWM. This is a low number and sustainable payout ratio.
DP9.02%
EPS Next 2Y30.86%
EPS Next 3Y27.57%
HOWMET AEROSPACE INC
NYSE:HWM (11/21/2024, 6:40:00 PM)
After market: 116.98 0 (0%)116.98
-1.12 (-0.95%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap47.52B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.28% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 47.17 | ||
| Fwd PE | 36.93 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.09
PEG (5Y)7.43
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.18% | ||
| ROE | 23.87% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 21.32% | ||
| PM (TTM) | 14.79% | ||
| GM | 30.4% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.69
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.75 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 2.24 | ||
| Quick Ratio | 0.98 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)45.88%
EPS 3Y23.59%
EPS 5Y
EPS Q2Q%
EPS Next Y43.39%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)13.2%
Revenue growth 3Y8.08%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y