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1. Company Snapshot

1.a. Company Description

Howmet Aerospace Inc.provides advanced engineered solutions for the aerospace and transportation industries in the United States, Japan, France, Germany, the United Kingdom, Mexico, Italy, Canada, Poland, China, and internationally.It operates through four segments: Engine Products, Fastening Systems, Engineered Structures, and Forged Wheels.


The Engine Products segment offers airfoils and seamless rolled rings primarily for aircraft engines and industrial gas turbines; and rotating parts, as well as structural parts.The Fastening Systems segment produces aerospace fastening systems, as well as commercial transportation, industrial, and other fasteners.The Engineered Structures segment provides titanium ingots and mill products for aerospace and defense applications; and aluminum and nickel forgings, and machined components and assemblies.


The Forged Wheels segment offers forged aluminum wheels and related products for heavy-duty trucks and commercial transportation markets.The company was formerly known as Arconic Inc.The company was founded in 1888 and is based in Pittsburgh, Pennsylvania.

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1.b. Last Insights on HWM

Howmet Aerospace's recent performance was driven by strong commercial aerospace growth, with sales jumping 9% and contributing to a 104% stock surge year-over-year. The company's defense growth also fueled its momentum, with sales surging 21% in Q2 2025, powered by F-35 engine demand and strong military funding. Additionally, Howmet's solid growth attributes, including robust shareholder returns and strong aerospace demand, position it for continued upside.

1.c. Company Highlights

2. Howmet Aerospace's Q3 2025 Earnings: A Strong Performance

Howmet Aerospace reported a robust Q3 2025, with revenue growing 14% year-over-year to exceed $1.1 billion in the Commercial Aerospace segment, driven by a 38% increase in commercial aero part sales. EBITDA rose 26% and operating income increased 29%. Earnings per share (EPS) came in at $0.95, beating estimates of $0.91, representing a 34% increase. The company's cash flow was $423 million, with $108 million in capital expenditures. Share buybacks totaled $200 million in Q3 and an additional $100 million in October, bringing the year-to-date total to $600 million.

Publication Date: Nov -03

📋 Highlights
  • Revenue & Profit Growth:: Q3 revenue up 14% YoY ($1.1B+ Commercial Aerospace segment), EBITDA rose 26%, and operating income increased 29%.
  • Strong Cash Flow & Leverage:: Free cash flow reached $423M, with $660M cash balance and net leverage at 1.1x (net debt-to-EBITDA).
  • Share Buybacks:: $200M deployed in Q3 and $100M in October, totaling $600M year-to-date, signaling confidence in capital return.
  • Upgraded 2025 Guidance:: Revenue raised to $8.15B, EBITDA to $2.375B, and EPS to $3.67, with 2026 revenue guided to $9B (+10% YoY).

Segmental Performance

The Commercial Aerospace segment's revenue exceeded $1.1 billion, driven by engine spares demand and a record backlog for new aircraft. Defense Aerospace grew 24%, driven by engine spares and F-35 aircraft builds. Industrial and other markets were up 18%, driven by oil and gas and Industrial Gas Turbines (IGT). The company's diversified portfolio and strong demand across segments contributed to its robust financial performance.

Guidance and Outlook

The company raised its 2025 revenue outlook to $8.15 billion and EBITDA to $2.375 billion, with EPS expected to be $3.67. For 2026, it expects revenue of $9 billion, representing a 10% year-over-year increase. The company's growth is driven by large industrial gas turbines for utilities and data centers, with increasing demand for midsized turbines. The outlook for 2026 is positive, with commercial aerospace expected to grow a few percentage points, defense expected to grow mid-single digits, and the industrial segment expected to grow in double digits.

Valuation and Metrics

With a P/E Ratio of 57.24 and EV/EBITDA of 38.15, the company's valuation multiples are relatively high, indicating that the market has priced in significant growth expectations. The company's return on equity (ROE) is 29.7%, and return on invested capital (ROIC) is 16.93%, indicating a strong ability to generate returns. The net debt-to-EBITDA ratio stands at 1.1x, indicating a manageable level of leverage.

Growth Drivers and Initiatives

The company's growth is driven by its strong position in the commercial aerospace and defense segments, as well as its expanding presence in the industrial gas turbines market. The company is investing in growth initiatives, including a new Michigan Aero Engine core and casting plant, and expansions in Europe and the US. The company's focus on automation, artificial intelligence, and data collection in its manufacturing process is expected to drive margin expansion and improve competitiveness.

3. NewsRoom

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Howmet Aerospace Inc. $HWM Position Trimmed by 1832 Asset Management L.P.

Dec -03

Source: defenseworld.net

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Is the Options Market Predicting a Spike in Howmet Aerospace Stock?

Dec -01

Source: zacks.com

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Potentially 12%-15% Consistent Income: Monthly Options Series (December 2025)

Nov -30

Source: seekingalpha.com

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Wheels Up Experience (NYSE:UP) and Howmet Aerospace (NYSE:HWM) Head-To-Head Analysis

Nov -30

Source: defenseworld.net

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Aspire Growth Partners LLC Sells 245 Shares of Howmet Aerospace Inc. $HWM

Nov -29

Source: defenseworld.net

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Rep. Lisa C. McClain Buys Howmet Aerospace Inc. (NYSE:HWM) Stock

Nov -27

Source: defenseworld.net

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997 Shares in Howmet Aerospace Inc. $HWM Bought by AlphaCore Capital LLC

Nov -26

Source: defenseworld.net

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Strength in Defense Aerospace Drives Howmet: Will the Momentum Last?

Nov -25

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.76%)

6. Segments

Engine Products

Expected Growth: 9.5%

The 9.5% growth in Engine Products from Howmet Aerospace Inc. is driven by increasing demand for commercial aerospace engines, recovery in industrial gas turbine demand, and market share gains. Additionally, the company's focus on innovative products and services, such as advanced materials and 3D printing, contributes to its growth momentum.

Fastening Systems

Expected Growth: 10.2%

The 10.2% growth in Fastening Systems from Howmet Aerospace Inc. is driven by increasing demand for lightweight and advanced materials in commercial aerospace, recovery in defense spending, and growth in the aftermarket segment. Additionally, Howmet's focus on innovation and strategic acquisitions have contributed to its strong performance.

Engineered Structures

Expected Growth: 8.8%

The 8.8% growth in Engineered Structures from Howmet Aerospace Inc. is driven by increasing demand for lightweight, high-strength components in the aerospace and defense industries. Key factors include rising commercial aircraft production, growing aftermarket services, and the company's expanding capabilities in advanced materials and manufacturing technologies.

Forged Wheels

Expected Growth: 11.0%

The 11.0% growth in Forged Wheels from Howmet Aerospace Inc. is driven by increasing demand for lightweight, high-strength wheels in the aerospace and defense industries. Additionally, the company's innovative manufacturing processes and strategic partnerships with major aircraft producers contribute to its growth, enabling it to capitalize on the trend towards more fuel-efficient and sustainable aircraft designs.

Inter-Segment Sales

Expected Growth: 9.0%

Inter-Segment Sales growth of 9.0% for Howmet Aerospace Inc. is driven by increased demand for engineered materials and precision components across segments, favorable pricing, and efficient supply chain management. This growth reflects strong intersegment collaboration and synergies within the company, likely driven by aerospace and defense sector recovery and growth in commercial aerospace.

7. Detailed Products

Engine Components

High-performance, precision-engineered components for jet engines, including turbine blades, vanes, and other critical parts

Fastening Systems

High-strength, precision-engineered fasteners and related products, including bolts, nuts, and pins

Rotating Components

High-performance, precision-engineered rotating components, including engine bearings, shafts, and gears

Aerostructures

Engineered structures and components for aircraft and spacecraft, including fuselage sections, wing components, and satellite parts

Additive Manufacturing

3D-printed metal components and parts, including complex geometries and customized designs

8. Howmet Aerospace Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Howmet Aerospace Inc. operates in the aerospace and industrial gas turbine industries, where substitutes are limited due to the high specificity and customization of its products. The company's products are often critical components in aircraft and gas turbines, making substitution difficult.

Bargaining Power Of Customers

Howmet Aerospace Inc.'s customers, primarily large aerospace and industrial gas turbine manufacturers, have some bargaining power due to their significant order volumes. However, the company's products are critical to their operations, which somewhat limits customer bargaining power.

Bargaining Power Of Suppliers

Howmet Aerospace Inc. likely has a diverse supplier base and may have some flexibility in sourcing materials. The company may also have significant negotiating power due to its large order volumes and long-term supplier relationships.

Threat Of New Entrants

The aerospace and industrial gas turbine industries have significant barriers to entry, including high capital requirements, stringent regulatory requirements, and the need for specialized expertise. This limits the threat of new entrants.

Intensity Of Rivalry

The aerospace and industrial gas turbine industries are highly competitive, with several established players. However, Howmet Aerospace Inc. has a strong market position and a diversified product portfolio, which somewhat mitigates the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 43.25%
Debt Cost 6.28%
Equity Weight 56.75%
Equity Cost 10.87%
WACC 8.89%
Leverage 76.22%

11. Quality Control: Howmet Aerospace Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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AMETEK

A-Score: 5.4/10

Value: 1.7

Growth: 6.1

Quality: 8.1

Yield: 1.0

Momentum: 6.0

Volatility: 9.3

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Xylem

A-Score: 5.2/10

Value: 1.8

Growth: 5.7

Quality: 6.7

Yield: 2.0

Momentum: 6.0

Volatility: 9.0

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Howmet Aerospace

A-Score: 5.1/10

Value: 0.0

Growth: 6.8

Quality: 6.7

Yield: 0.0

Momentum: 9.5

Volatility: 7.7

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Roper Technologies

A-Score: 5.0/10

Value: 2.6

Growth: 5.7

Quality: 7.4

Yield: 1.0

Momentum: 3.0

Volatility: 10.0

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Otis

A-Score: 4.9/10

Value: 4.4

Growth: 4.4

Quality: 5.7

Yield: 3.0

Momentum: 3.0

Volatility: 9.0

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Ingersoll Rand

A-Score: 4.3/10

Value: 1.8

Growth: 7.6

Quality: 6.6

Yield: 0.0

Momentum: 2.5

Volatility: 7.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

190.98$

Current Price

190.98$

Potential

-0.00%

Expected Cash-Flows