Howmet (HWM) closed at $192.15 in the latest trading session, marking a +1.01% move from the prior day. The stock’s performance was ahead of the S&P 500’s daily gain of 0.44%. On the other hand, the Dow registered a gain of 0.14%, and the technology-centric Nasdaq increased by 0.7%.
The maker of engineered products for the aerospace and other industries’s stock has climbed by 11.25% in the past month, exceeding the Aerospace sector’s gain of 4.93% and the S&P 500’s gain of 4.03%.
Investors will be eagerly watching for the performance of Howmet in its upcoming earnings disclosure. In that report, analysts expect Howmet to post earnings of $0.9 per share. This would mark year-over-year growth of 26.76%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.04 billion, up 11.3% from the year-ago period.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $3.57 per share and revenue of $8.12 billion. These totals would mark changes of +32.71% and +9.35%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for Howmet. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Consequently, upward revisions in estimates express analysts’ positivity towards the business operations and its ability to generate profits.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To exploit this, we’ve formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Currently, Howmet is carrying a Zacks Rank of #3 (Hold).
Looking at its valuation, Howmet is holding a Forward P/E ratio of 53.24. Its industry sports an average Forward P/E of 24.64, so one might conclude that Howmet is trading at a premium comparatively.
Investors should also note that HWM has a PEG ratio of 2.47 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. As the market closed yesterday, the Aerospace – Defense industry was having an average PEG ratio of 2.1.
