HOWMET AEROSPACE INC (HWM)
US4432011082 - Common Stock
We assign a fundamental rating of 6 out of 10 to HWM. HWM was compared to 65 industry peers in the Aerospace & Defense industry. HWM has an excellent profitability rating, but there are some minor concerns on its financial health. HWM has a correct valuation and a medium growth rate.
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 Return On Assets of 10.18%. This is amongst the best in the industry. HWM outperforms 90.77% of its industry peers.
Looking at the Return On Equity, with a value of 23.87%, HWM belongs to the top of the industry, outperforming 93.85% of the companies in the same industry.
With an excellent Return On Invested Capital value of 13.36%, HWM belongs to the best of the industry, outperforming 93.85% of the companies in the same industry.
HWM had an Average Return On Invested Capital over the past 3 years of 9.00%. This is in line with the industry average of 7.69%.
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
HWM has a better Profit Margin (14.79%) than 92.31% of its industry peers.
In the last couple of years the Profit Margin of HWM has grown nicely.
The Operating Margin of HWM (21.32%) is better than 95.38% of its industry peers.
In the last couple of years the Operating Margin of HWM has grown nicely.
HWM has a better Gross Margin (30.40%) than 73.85% 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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), HWM is creating some value.
Compared to 1 year ago, HWM has less shares outstanding
Compared to 5 years ago, HWM has less shares outstanding
Compared to 1 year ago, HWM has an improved debt to assets ratio.
2.2 Solvency
HWM has an Altman-Z score of 6.17. This indicates that HWM is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of HWM (6.17) is better than 80.00% of its industry peers.
The Debt to FCF ratio of HWM is 3.39, which is a good value as it means it would take HWM, 3.39 years of fcf income to pay off all of its debts.
HWM has a Debt to FCF ratio of 3.39. This is amongst the best in the industry. HWM outperforms 81.54% of its industry peers.
HWM has a Debt/Equity ratio of 0.75. This is a neutral value indicating 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 67.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.75 | ||
| Debt/FCF | 3.39 | ||
| Altman-Z | 6.17 |
ROIC/WACC1.4
WACC9.57%
2.3 Liquidity
HWM has a Current Ratio of 2.24. This indicates that HWM is financially healthy and has no problem in meeting its short term obligations.
HWM's Current ratio of 2.24 is in line compared to the rest of the industry. HWM outperforms 56.92% 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.
HWM has a Quick ratio (0.98) which is comparable to the rest of the industry.
| 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 23.55% yearly.
The Revenue is expected to grow by 10.69% on average over the next years. This is quite good.
EPS Next Y45.67%
EPS Next 2Y32.26%
EPS Next 3Y28.98%
EPS Next 5Y23.55%
Revenue Next Year13.27%
Revenue Next 2Y10.94%
Revenue Next 3Y11.16%
Revenue Next 5Y10.69%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 44.69, which means the current valuation is very expensive for HWM.
HWM's Price/Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Earnings ratio of 27.73, HWM is valued quite expensively.
A Price/Forward Earnings ratio of 34.25 indicates a quite expensive valuation of HWM.
HWM's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 22.83. HWM is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 44.69 | ||
| Fwd PE | 34.25 |
4.2 Price Multiples
HWM's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, HWM is valued a bit cheaper than the industry average as 66.15% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 44.94 | ||
| EV/EBITDA | 26.31 |
4.3 Compensation for Growth
HWM's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of HWM may justify a higher PE ratio.
A more expensive valuation may be justified as HWM's earnings are expected to grow with 28.98% in the coming years.
PEG (NY)0.98
PEG (5Y)7.04
EPS Next 2Y32.26%
EPS Next 3Y28.98%
5. Dividend
5.1 Amount
With a yearly dividend of 0.29%, HWM is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.42, HWM pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.29, HWM pays less dividend than the S&P500 average, which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.29% |
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 2Y32.26%
EPS Next 3Y28.98%
HOWMET AEROSPACE INC
NYSE:HWM (12/20/2024, 8:17:25 PM)
After market: 110.83 0 (0%)110.83
+1.48 (+1.35%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners93.64%
Inst Owner Change-0.15%
Ins Owners1.05%
Ins Owner Change-8.86%
Market Cap45.03B
Analysts80.67
Price Target124.96 (12.75%)
Short Float %2.02%
Short Ratio3.5
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.29% |
Dividend Growth(5Y)-6.38%
DP9.02%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.87%
Min EPS beat(2)7.34%
Max EPS beat(2)10.4%
EPS beat(4)4
Avg EPS beat(4)9.84%
Min EPS beat(4)7.34%
Max EPS beat(4)12.72%
EPS beat(8)7
Avg EPS beat(8)7.02%
EPS beat(12)10
Avg EPS beat(12)5.77%
EPS beat(16)14
Avg EPS beat(16)7%
Revenue beat(2)1
Avg Revenue beat(2)-0.26%
Min Revenue beat(2)-1.87%
Max Revenue beat(2)1.35%
Revenue beat(4)3
Avg Revenue beat(4)1.8%
Min Revenue beat(4)-1.87%
Max Revenue beat(4)3.99%
Revenue beat(8)7
Avg Revenue beat(8)2.49%
Revenue beat(12)9
Avg Revenue beat(12)1.38%
Revenue beat(16)9
Avg Revenue beat(16)0.57%
PT rev (1m)13.33%
PT rev (3m)19.87%
EPS NQ rev (1m)0.07%
EPS NQ rev (3m)14.92%
EPS NY rev (1m)1.59%
EPS NY rev (3m)2.98%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)0.9%
Revenue NY rev (1m)-0.12%
Revenue NY rev (3m)-0.53%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 44.69 | ||
| Fwd PE | 34.25 | ||
| P/S | 6.19 | ||
| P/FCF | 44.94 | ||
| P/OCF | 35.29 | ||
| P/B | 10 | ||
| P/tB | N/A | ||
| EV/EBITDA | 26.31 |
EPS(TTM)2.48
EY2.24%
EPS(NY)3.24
Fwd EY2.92%
FCF(TTM)2.47
FCFY2.23%
OCF(TTM)3.14
OCFY2.83%
SpS17.89
BVpS11.08
TBVpS-0.07
PEG (NY)0.98
PEG (5Y)7.04
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.18% | ||
| ROE | 23.87% | ||
| ROCE | 17.14% | ||
| ROIC | 13.36% | ||
| ROICexc | 14.1% | ||
| ROICexgc | 29.93% | ||
| OM | 21.32% | ||
| PM (TTM) | 14.79% | ||
| GM | 30.4% | ||
| FCFM | 13.78% |
ROA(3y)4.79%
ROA(5y)3.86%
ROE(3y)13.06%
ROE(5y)11.32%
ROIC(3y)9%
ROIC(5y)8.04%
ROICexc(3y)9.78%
ROICexc(5y)8.95%
ROICexgc(3y)22.46%
ROICexgc(5y)19.61%
ROCE(3y)11.55%
ROCE(5y)10.32%
ROICexcg growth 3Y14.98%
ROICexcg growth 5Y22.93%
ROICexc growth 3Y15.57%
ROICexc growth 5Y16.03%
OM growth 3Y6.32%
OM growth 5Y5.94%
PM growth 3Y32.63%
PM growth 5Y4.01%
GM growth 3Y2.3%
GM growth 5Y2.75%
F-Score9
Asset Turnover0.69
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.75 | ||
| Debt/FCF | 3.39 | ||
| Debt/EBITDA | 1.86 | ||
| Cap/Depr | 100.74% | ||
| Cap/Sales | 3.77% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 70.03% | ||
| Profit Quality | 93.21% | ||
| Current Ratio | 2.24 | ||
| Quick Ratio | 0.98 | ||
| Altman-Z | 6.17 |
F-Score9
WACC9.57%
ROIC/WACC1.4
Cap/Depr(3y)75.68%
Cap/Depr(5y)85.13%
Cap/Sales(3y)3.57%
Cap/Sales(5y)4.96%
Profit Quality(3y)100.89%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)45.88%
EPS 3Y23.59%
EPS 5Y6.35%
EPS Q2Q%54.35%
EPS Next Y45.67%
EPS Next 2Y32.26%
EPS Next 3Y28.98%
EPS Next 5Y23.55%
Revenue 1Y (TTM)13.2%
Revenue growth 3Y8.08%
Revenue growth 5Y-0.41%
Sales Q2Q%10.68%
Revenue Next Year13.27%
Revenue Next 2Y10.94%
Revenue Next 3Y11.16%
Revenue Next 5Y10.69%
EBIT growth 1Y34.9%
EBIT growth 3Y14.91%
EBIT growth 5Y5.5%
EBIT Next Year58.24%
EBIT Next 3Y27.05%
EBIT Next 5Y23.88%
FCF growth 1Y169.36%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y119.62%
OCF growth 3Y364.33%
OCF growth 5Y32.94%