HOWMET AEROSPACE INC (HWM)
US4432011082 - Common Stock
HWM gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 64 industry peers in the Aerospace & Defense industry. While HWM has a great profitability rating, there are some minor concerns on its financial health. HWM is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year HWM was profitable.
In the past year HWM had a positive cash flow from operations.
In the past 5 years HWM has always been profitable.
In the past 5 years HWM always reported a positive cash flow from operatings.
1.2 Ratios
HWM has a better Return On Assets (8.24%) than 87.50% of its industry peers.
HWM's Return On Equity of 21.00% is amongst the best of the industry. HWM outperforms 93.75% of its industry peers.
Looking at the Return On Invested Capital, with a value of 11.71%, HWM belongs to the top of the industry, outperforming 93.75% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for HWM is in line with the industry average of 8.09%.
The last Return On Invested Capital (11.71%) for HWM is above the 3 year average (9.00%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.24% | ||
| ROE | 21% | ||
| ROIC | 11.71% |
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
With an excellent Profit Margin value of 12.51%, HWM belongs to the best of the industry, outperforming 82.81% of the companies in the same industry.
HWM's Profit Margin has improved in the last couple of years.
HWM's Operating Margin of 19.08% is amongst the best of the industry. HWM outperforms 90.63% of its industry peers.
In the last couple of years the Operating Margin of HWM has grown nicely.
Looking at the Gross Margin, with a value of 28.60%, HWM is in the better half of the industry, outperforming 73.44% of the companies in the same industry.
In the last couple of years the Gross Margin of HWM has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.08% | ||
| PM (TTM) | 12.51% | ||
| GM | 28.6% |
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.
HWM has less shares outstanding than it did 1 year ago.
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 4.58. This indicates that HWM is financially healthy and has little risk of bankruptcy at the moment.
HWM's Altman-Z score of 4.58 is fine compared to the rest of the industry. HWM outperforms 76.56% of its industry peers.
HWM has a debt to FCF ratio of 4.51. This is a neutral value as HWM would need 4.51 years to pay back of all of its debts.
HWM has a better Debt to FCF ratio (4.51) than 76.56% of its industry peers.
A Debt/Equity ratio of 0.85 indicates that HWM is somewhat dependend on debt financing.
HWM has a worse Debt to Equity ratio (0.85) than 68.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.85 | ||
| Debt/FCF | 4.51 | ||
| Altman-Z | 4.58 |
ROIC/WACC1.4
WACC8.35%
2.3 Liquidity
HWM has a Current Ratio of 1.97. This is a normal value and indicates that HWM is financially healthy and should not expect problems in meeting its short term obligations.
HWM has a Current ratio (1.97) which is comparable to the rest of the industry.
A Quick Ratio of 0.92 indicates that HWM may have some problems paying its short term obligations.
With a Quick ratio value of 0.92, HWM is not doing good in the industry: 64.06% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.97 | ||
| Quick Ratio | 0.92 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 32.45% over the past year.
The Earnings Per Share has been growing slightly by 6.35% on average over the past years.
Looking at the last year, HWM shows a quite strong growth in Revenue. The Revenue has grown by 15.47% in the last year.
The Revenue has been decreasing by -0.41% on average over the past years.
EPS 1Y (TTM)32.45%
EPS 3Y23.59%
EPS 5Y6.35%
EPS Q2Q%35.71%
Revenue 1Y (TTM)15.47%
Revenue growth 3Y8.08%
Revenue growth 5Y-0.41%
Sales Q2Q%13.79%
3.2 Future
Based on estimates for the next years, HWM will show a quite strong growth in Earnings Per Share. The EPS will grow by 19.16% on average per year.
HWM is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.61% yearly.
EPS Next Y30.9%
EPS Next 2Y25.8%
EPS Next 3Y23.68%
EPS Next 5Y19.16%
Revenue Next Year12.14%
Revenue Next 2Y10.97%
Revenue Next 3Y10.37%
Revenue Next 5Y8.61%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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 39.47, which means the current valuation is very expensive for HWM.
The rest of the industry has a similar Price/Earnings ratio as HWM.
HWM is valuated rather expensively when we compare the Price/Earnings ratio to 28.42, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 26.96, which means the current valuation is very expensive for HWM.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HWM is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.02, HWM is valued a bit more expensive.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 39.47 | ||
| Fwd PE | 26.96 |
4.2 Price Multiples
HWM's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, HWM is valued a bit cheaper than 67.19% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 39.39 | ||
| EV/EBITDA | 22.41 |
4.3 Compensation for Growth
HWM's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct 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 23.68% in the coming years.
PEG (NY)1.28
PEG (5Y)6.22
EPS Next 2Y25.8%
EPS Next 3Y23.68%
5. Dividend
5.1 Amount
With a yearly dividend of 0.24%, HWM is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.37, HWM pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.24, HWM pays less dividend than the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.24% |
5.2 History
The dividend of HWM decreases each year by -6.38%.
HWM has paid a dividend for at least 10 years, which is a reliable track record.
HWM has decreased its dividend in the last 3 years.
Dividend Growth(5Y)-6.38%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
8.97% of the earnings are spent on dividend by HWM. This is a low number and sustainable payout ratio.
DP8.97%
EPS Next 2Y25.8%
EPS Next 3Y23.68%
HOWMET AEROSPACE INC
NYSE:HWM (6/14/2024, 7:14:48 PM)
After market: 78.75 -0.19 (-0.24%)78.94
-3.86 (-4.66%)
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 Cap32.22B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.24% |
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)
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Min EPS beat(4)
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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)
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Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
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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 | 39.47 | ||
| Fwd PE | 26.96 | ||
| 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)1.28
PEG (5Y)6.22
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.24% | ||
| ROE | 21% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 19.08% | ||
| PM (TTM) | 12.51% | ||
| GM | 28.6% | ||
| 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 Turnover0.66
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.85 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.97 | ||
| Quick Ratio | 0.92 | ||
| 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)32.45%
EPS 3Y23.59%
EPS 5Y
EPS Q2Q%
EPS Next Y30.9%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)15.47%
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