Howmet Aerospace Inc. (HWM) stock analysis

P/E below its 5-year median

Howmet Aerospace's P/E of 43.2 is below its own 5-year median of 45.0.

P/E above the industry

Howmet Aerospace's P/E of 43.2 is above the Rolling, Drawing, and Extruding of Nonferrous median of 21.1.

EV/EBITDA above its 5-year median

Howmet Aerospace's EV/EBITDA of 30.0 is above its 5-year median of 22.7.

P/B above the industry

Howmet Aerospace's price-to-book of 15.24 is above the Rolling, Drawing, and Extruding of Nonferrous median of 3.13.

Trading above fair value

The share price of $220.82 is above our fair value estimate of $143.45.

Margin of safety under 20%

The price is 53.9% above fair value, so there is no margin of safety.

Revenue growing 10%+ a year

Revenue grew 13.4% a year over the last three fiscal years.

EPS growing 10%+ a year

Diluted EPS grew 49.5% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew 41.6% over the last twelve months, against a 5-year average of 42.0% a year.

Growing faster than the industry

Revenue grew 22.0% over the last twelve months; the Rolling, Drawing, and Extruding of Nonferrous median is 18.3%.

Guidance raised

Howmet Aerospace raised its FY 2026 Guidance Revenue outlook on Aug 6, 2026.

Gross margin improving

Gross margin was 36.6% over the last twelve months, against 33.4% a year earlier.

Return on equity over 15%

Return on equity was 37.7% over the last twelve months and averaged 19.6% over five years.

Return on capital over 10%

Return on invested capital was 25.7%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Howmet Aerospace's return on equity of 37.7% is above the Rolling, Drawing, and Extruding of Nonferrous median of 15.6%.

Earnings grew over 5 years

Net income grew 42.0% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 21.1% over the last twelve months, against a 5-year average of 11.8%.

Net margin above the industry

Howmet Aerospace's net margin of 21.1% is above the Rolling, Drawing, and Extruding of Nonferrous median of 5.2%.

High debt

Debt is 77.1% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 152% five years ago to 77.1%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 54.0% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 1.86 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 9.18; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Howmet Aerospace paid dividends worth 0.2% of the share price over the last twelve months.

Yield below Treasuries

The 0.2% yield is below the 4.7% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Howmet Aerospace yields 0.2%.

Dividend was cut

The dividend per share fell by more than 10% at least once in the last 10 fiscal years.

Earnings cover

Needs dividends paid and net income.

Cash-flow cover

Needs dividends paid and free cash flow.